The benchmark Sensex and Nifty touched their historic highs during the week under review notwithstanding, the market moved southwards on SEBI's proposal to restrict foreign fund inflows in equity markets, snapping 8-week unprecedented bull run.
The BSE 30-share barometer opened higher at 18,525.61 from last weekend's close of 18,419.04 and crossed the 19K-mark for the first time and touched 19,198.66, following stability on the political front.
However, the action taken by Securities and Exchange Board of India (SEBI) to limit the foreign fund inflows to restrict the Offshore Derivative Instruments (ODI) gave a much needed impetus to the heated market to make corrections.
Finally, the Sensex ended the week at 17,559.98, down by 859.06 points or 4.66 per cent over the last weekend.
Similarly, the S&P CNX Nifty of the National Stock Exchange (NSE) also logged an all-time high of 5,736.80 and later tumbled to end the week at 5,215.30, a steep fall of 212.95 points or 3.92 per cent over the last weekend's close of 5,428.25.
The corrections started from Wednesday after SEBI's move. Sensex tanked by a record 1,744 points on fears of withdrawal by foreign funds but staged a smart recovery after Finance Minister P Chidambaram and SEBI Chairman M Damodaran's statement that they are not going to ban PNs, but wanted to restrict the copious inflows.
Most blue chips, except some of the IT counters, attracted heavy profit-selling while hedge funds, which invest for the short term, also sold heavily.
Initially, the stock market received a setback following growing differences between the Congress and it key partner the Left on the nuclear deal but both the parties later agreed to resolve the issue indicating peace on political front, helping Sensex to cross 19K-mark for the first time in the history.
However, the pace of bull run surprised the government, forcing Chidambaram to caution investors from entering the market when it hit 18K and attributed the rise to speculative activity.
But the bull market got a jolt on Wednesday after SEBI came out with a proposal on Tuesday night, both key indices struck at 10 per cent lower circuit band immediately after resumption of dealings, halting the trading for an hour.
The market later staged a dramatic recovery when trading resumed again at 1055 hours after the finance minister assured that the government was not against PNs but only wanted to cap certain types of instruments.
Damodaran clarified that the proposals on ODIs were a well-designed package and asked investors not to be carried away by rumours.
However, recovery was shortlived as hedge funds and operators went on selling spree at every higher levels.
Foreign Institutional Investors (FIIs), which were heavy buyers since September 19, turned net sellers on the last two days.
Besides consumer durables, all other sectoral indices closed with sharp to moderate losses.
Real estate and capital goods suffered a sharp setback on heavy sell-off. The BSE-Real index plunged by 824.73 points or 8.35 per cent to 9,053.64 and the BSE-CG by 1,185.40 points or 7.13 per cent to 15,429.29.
During the week, the trading volume on BSE and NSE improved further to Rs 51,947 crore and Rs 1,14,493 crore from Rs 43,805 crore and Rs 94,333 crore, respectively, last weekend.
The broad-based BSE-100 index tumbled by 480.83 points or 5.05 per cent to end the week at 9,045.14 from preceding weekend's close of 9,525.97.
The BSE-200 index and the Dollex-200 were also quoted sharply lower at 2,129.29 and 891.94 at the weekend from last weekend's close of 2,241.10 and 918.33, respectively.
The BSE-500 index also ended the week sharply down by 333.12 points to 6,807.66 from 7,140.78 and the Dollex-30 ended down at 3,627.30 from 3,721.88 last weekend. - DDNEWS
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