Stocks open sharply lower; Sensex down 285 points

Stocks tumbled at open on Monday tracking the weakness across other Asian markets. National Stock Exchange’s benchmark Nifty slid 50 points t
o 3767.90. Bombay Stock Exchange’s 30-share Sensex shed 285 points to 12240 from Friday’s close.

Even as the US House of Representatives approved the $700-billion Wall Street bailout Friday, a steep drop in US jobs data suggested the world's largest economy may be in a recession, threatening global growth. The market sentiment weakened as traders focussed on the tough economic road ahead and on how the bill will be implemented.

Wall Street ended its worst week in seven years with another tumble on Friday. The Dow Jones Industrial Average fell 157.15 points, or 1.50 per cent, to 10,325.70, while the Standard & Poor's 500 Index slid 15.04 points, or 1.35 per cent, to 1,099.24 and the Nasdaq Composite Index was down 29.33 points, or 1.48 per cent, at 1,947.39.

Asian markets also declined on fears that the financial crisis is hitting the wider economy prompting investors to dump shares. At the time Indian markets opened for trade, the Nikkei dropped 3.6 per cent, Hang Seng lost 2.56 per cent and Straits Times shed 2.39 per cent.

Back home, the Securities & Exchange Board of India is likely to discuss a proposal to ease some of the restrictions imposed on foreign institutional investors at its board meeting on Monday, in an effort to bolster capital inflows. This could help lift market sentiment.

“The market hopes that Sebi may lift some of the constraints on issuance of PNs that were put in place in October last year. This move, if it comes, could help the markets, but there does not seem to be any money right now. However, the markets are unlikely to take note of it in advance. Expect the markets to tumble and test the earlier bottoms of 12153 in the Sensex and the 3715 level in the Nifty,” said Anagram Stock Broking.

Source: EconomicTimes