More, the market picture is distorted as the divide gets wider by the day. Thus we see the rising prices of HLL and ITC leading to an increase in their index weight and the rest falling in line with their downtrend.

Though the sensex is only 20 points away from the December 4, 1996 level of 2745, a closer look at the index leaders throws up a far more gloomy picture than what is being portrayed. The key to the skewed picture of the market lies in ITC and HLL which are quoting at a premium of almost 100 per cent to their October 1996 levels. Today, ITC at Rs 693 is 110 per cent higher than Rs 330 in October 1996. Similarly, HLL has almost doubled from Rs 872 to Rs 1708 during the same period.

Apart from these two, onlyNestle and Glaxo have managed to show a positive growth in their share prices during these two years.

These four scrips have a combined weight of 40 per cent based on the current market prices. The remaining 26 have shown a fall in the range of three per cent to 78 per cent. Of these, Bajaj Auto, Reliance Industries, Ranbaxy Limited and BHEL have dropped marginally in the rnage of three per cent and seven per cent. These four, which have a combined weight of 17.5 per cent in the sensex, have also helped the market hold on to the current levels. Any sharper fall would have meant a much lower index.

It is this slump that is far more worrying than the actual level of the sensex today. These companies are the country's corporate leaders in their respective industries. Thanks to a 38 per cent fall in State Bank of India (index weight 5.71 per cent) and a 21 per cent dip in MTNL (weight 8.23 per cent) today the market is struggling to recover from the bottom.

The worst hit have been those of the Tata group ofcompanies. Telco is down 70 per cent, Tisco 60 per cent, Tata Chemicals 59 per cent and Tata Power 36 per cent compared to their October, 1996 levels. The combined weight of the Tata group is 5.4 per cent.

Though Arvind Mills and Steel Authority of India Limited do not command much weight they have dragged the index down as the fall in their share prices have been much sharper. For example, the combined weight of Arvind Mills, Sail, Telco, Grasim Industries, IDBI, Tisco, Tata Chemicals, IPCL, Mahindra and Mahindra and GE Shipping is 11.2 per cent. These 10 scrips have lost more than 50 per cent over the past two years.

The divide between the best and the worst is not only sharp, but also grows every time those stocks which are already hit fall further. Take for instance the Sensex at 3225 on September 24 when HLL at Rs 1708 commanded a weight of 20.77 per cent. Today at the same price level, HLL's weight has gone up to 23 per cent. Similarly, ITC's weight has gone up from 10.58 per cent to 11.75 per cent,though its price has dropped marginally from Rs 706 to Rs 693. This is because the others are falling relentlessly.

At the same time, SBI's fall from Rs 208 to Rs 157 has resulted in its weight dropping from 6.75 per cent to 5.71 per cent. Reliance's fall from Rs 125 to Rs 105 has eroded its weight from 7.12 per cent to 6.81 per cent. Therefore, any erosion in the values of HLL and ITC could mean a free fall for the market.