Sensex falls for 4th week, tanks 698 points on global market worries

The BSE benchmark Sensex posted its longest four-week losing streak since October 2008 as it plunged by 698 points to end at the 15-month low of 16,141.67 during the truncated week in line with mayhem in global markets on economic worries.

The stock markets, BSE and NSE, were closed on Monday, August 15, on account of the 'Independence Day'.

Increased selling by foreign institutional investors (FIIs) also was one of the major reasons for the turmoil. FIIs pulled out over Rs 2,000 crore this week, taking the total to over Rs 7,600 crore in August so far.

Enduring European debt problems and murky US economic data released on Thursday indicated the world is going into another recession, distressing the market sentiment globally.

On the domestic front, higher inflation and rising interest rates, which might restrict the corporate profit growth, continued to weigh on the market.

FULL COVERAGE: How US, Europe economic worries played out

The downslide commenced from July 26 when RBI raised key lending rates by 50 basis points, higher than the market expectations. The situation was further exacerbated by external factors.

Sensex-based key stocks like RIL, Infosys, ICICI Bank, SBI, Tata Motors, Tata Steel, Jindal Steel, Sterlite, Wipro, Hindalco, Tata Power logged their new 52-week lows.

The Bombay Stock Exchange 30-share bellwether index resumed higher at 17,015.99 but later dipped below 16,000 to a low of 15,987.77, before ending at 16,141.67, lowest closing after May 25, 2010, a net loss of 697.96 points, or 4.14 per cent, from its last weekend's close.    
The broad-based NSE 50-share Nifty also slumped by 227.30 points, or 4.48 per cent, to end the week at nearly a 15-month low of 4,845.65. It touched a low of 4,796.10 before recovering some ground.

In straight four-week of losses, the Sensex collapsed by 2,580.63 points, or 13.78 per cent, and Nifty nosedived 788.30 points, or 13.99 per cent.

The Sensex registered its longest weekly losing string since October 2008 when crashed by 5,341.25 points, or 38.40 per cent, in straight five weeks.

Selling was seen across-the-board as all 13 sectoral indices ended with losses between 7.51 per cent and 0.25 per cent, while nine out of them logged their 52-week lows during the trading. Most of the other indices, too, recorded their 52-week lows.

Two and three-tier stocks got a huge drubbing on heavy selling by cautious retail investors and underperformed the Sensex. The BSE-Smallcap index was the top loser from all indices, falling a hefty 8.09 per cent. The BSE-Midcap tanked by 5.93 per cent.

Interest rate-sensitive stocks from banking, realty and auto segments suffered the most.

IT stocks , too, bore the brunt of heavy sell-off on hopes of another recession in the US and Europe, the two biggest markets for the infotech companies.

Realty shares continued their downslide on expectation of another hike in key interest rates by the apex bank although the overall inflation eased to 9.22 per cent for the month of July from 9.44 per cent in June, and food inflation dropped to 9.03 per cent for the week ended August 6 from 9.90 per cent last weekend, but they were still high.