After plunging almost 950 points in early afternoon trade on concerns that the deepening of the credit crisis will push the global economy into a crisis, the benchmark Sensex staged a partial recovery as European markets and US futures cut losses on hopes of a coordinated bailout plan by various countries and buying by domestic institutions. The BSE 30-share Sensex ended down 366.88 points or 3.14 per cent to 11,328.36.

With this loss, the Sensex has shed nearly 10,000 points from its all-time peak level of 21,206.77 registered on January 10, 2008. Big bulls foreign institutional investors (FIIs) have sold a net of $10 billion in Indian shares this year compared with a record inflow of $17.4 billion in 2007. This means for every $1 billion pulled out by FIIs, the Sensex made losses of 1,000 points. With the global markets reeling under a severe financial crisis, the Sensex — among Asia’s worst performers this year — has fallen 13 per cent over the last four sessions taking losses for 2008 to 44 per cent. “There was a bit of short-covering in the second half and some long-term investors such as insurance firms punted on the long,” Rajesh Jain, chief executive of Pranav Securities, said of the partial recovery in Indian shares.

Bank stocks came under heavy hammering on shattered sentiment for the sector globally. ICICI Bank slumped 6.5 per cent to its lowest close in more than three years. State Bank of India dropped 6.1 per cent. Export-focused outsourcing companies fell sharply as global recession worries overshadowed a slide in the rupee, which fell to its lowest against the dollar since August 2002.

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