Mumbai, Oct 13: For the money and stock markets, it was truly a day of horrors: The Bombay Stock Exchange Sensitive index dipped another 109 points to touch 3714 points, even as the rupee hit a new all-time low of 46.43/45 against the dollar. The rupee's fall was basically on account of developments in international markets and an up-tick in crude prices to $36.Opening the day at a wide 46.36/40 from its overnight 46.27/28, the rupee fell further during the day to 46.43/45 level. "The escalation of tension in the Middle-East after the bombing of Palestinian positions by Israel coupled with the suicide bombing attack on a US warship saw international oil prices move up to $36 a barrel", a dealer said, adding: "The market was volatile Friday the 13th: Sensex dips 109 pts, rupee at 46.35pts and fears that oil pool deficit may increase after the increase in oil prices had a negative impact on the market and rupee lost ground to the dollar."
Meanwhile, the stock markets too were rocked by "Friday the 13th" as stock prices crashed to touch new low levels following the collapse of the US markets.
The hangover of the US markets was seen in the morning itself as the stock prices opened lower in the morning with the Sensex touching a low of 3714.46 during the day. But some value-buying in later part of the day lifted Sensex to close the day at 3738.93, down by 108.6 5 points. Senior dealers on the money market said the fact that the rupee came off by close to 46.35/37 - stronger from its opening level - is a clear indicator that the weakness in the rupee is purely in reaction to exogenous factors and less to a sudden spurt in demand for dollars. "The rupee will move in line with the developments in the international markets... the market is cautious, but there is nothing more to it", a dealer with a forex brokerage said.
Forward premiums quoted higher with the six-month annualised forward premium at 4.72 per cent (4.40 per cent) and the one-year annualised premia at 4.84 per cent (4.46 per cent). October dollars quoted at 10/11 paise while in the far forwards, April was seen at 116/118 paise with May at 132/134 paise.
Call rates rose to 11 per cent after opening at 10.25-10.50 per cent. It rose to 10.95-11 per cent during the day on increased demand for funds and few players to lend. Most of the big players did not venture into the market due to the fall in the rupee and uncertain market conditions.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.