Andrew L D'Cunha
Mumbai, Oct 20: The BSE Sensex opened with gap down in line with Asian markets, but managed to trim losses. Sensex recovered partially and closed at 16937 down by 148 points after recovering about 200 points from the day low. Sensex touched intraday low of 16745 and high of 16962.
The BSE Sensex opened with a decline of 173 points at 16,912, while Nifty started with a fall of 53 points at 5,087. Continuous worries over a possible European deal has dampened the mood of investors. HDFC (-4.06%), Jaiprakash Associates (-3.63%), DLF (-3.39%), ICICI Bank (-3.02%) and Tata Power (-2.69%) were amongst the major Sensex losers.
Food inflation is back in double digits after a gap of a month-and-a-half and stood at 10.60 per cent for the week ending October 8 on the back of costlier vegetables, fruits, milk and protein-based items. Food inflation, as measured by Wholesale Price Index (WPI), stood at 9.32 per cent in the previous week. The rate of price rise of food items stood at 15.72 per cent in the corresponding week of 2010.
As per data released by the government today, vegetables became 17.59 per cent more expensive year-on-year during the week ended October 8. Fruits grew dearer by 12.39 per cent, milk by 10.80 per cent and eggs, meat and fish by 14.10 per cent on an annual basis. Fuel and power inflation stood at 15.17 per cent in the week under review, compared to 15.10 per cent in the previous week.
Asian markets feel sharply today. Shanghai and Hang Seng fell 2% each while Kospi and Taiwan lost 1.5% each; Nikkei and Straits Times were down 1%. Traders and investors confidence is low due to uncertainty in the market such euro-zone debt, economic data from the U.S. and the likely strength of the Chinese economy and double digit inflation in India.
The Indian rupee depreciated by 58 paise to 49.73 per dollar today. Despite festive season, gold remained under pressure for the third straight day in the bullion market here and lost Rs 255 to Rs 26,565 per 10 grams on sustained selling by stockists in tandem with a weakening trend in Asia.
Andrew L D'Cunha, Managing Director, WinWin Fin Advisory Pvt. Ltd. Mangalore. Email: finadvisoryltd@yahoo.com.