MUMBAI, MARCH 17: Bears tightened their grip on the stock markets as the ongoing sell-off in global markets rattled investors again, sending the Sensex plunging below the 15,000 level today. With global financial market worries intensifying, the Sensex lost 951.03 points, or 6.03 per cent to close at 14,809.49. It hit a low of 14,739.72 in late trade, its lowest level since late August 2007.

The market tumbled as the fire sale of ailing US investment bank Bear Stearns and the US Federal Reserve’s emergency cut in its discount rate intensified concerns that there could be more victims of the global credit crisis. The mood is downbeat on the street. “The bulls are waiting in the darkness and praying for a miracle. But the nightmare is likely to continue,” broking firm India Infoline said in a report.

D D Sharma, Senior Vice-President, Anand Rathi Financial Service, said: “Global meltdown and sell-off by troubled FIIs in domestic markets, are playing havoc with sentiments of domestic investors. Fear of more disturbing news from global markets is weighing heavy on traders’ mind. Even long term domestic players like insurance firms and mutual funds are staying clear of the market.” Technically markets are now into new lows and Sensex chart shows bearish indications. Going by valuations, it looks as if there’s a great buying opportunity for investors, but no one can really take a call on bottom of the market, he said.

“People are anticipating a further fall in valuation of some stocks and that is aggravating their depreciation. In the case of ICICI Bank, the marked to market losses of not shared assets is being speculated to go down further so there was heavy selling pressure on that counter,” said R Ravi, equity analyst at Karvy Stock Broking Ltd.

Consumer durable index was a major loser among sectoral indices on BSE. It fell more than 10%. Banking stocks declined further in late trade. State Bank of India declined by 4.7 per cent and ICICI Bank was down 13.76 per cent. Reliance Industries declined 6 per cent. Reliance Communications fell 6.87 per cent and Reliance Power declined 6.45 per cent. “Don’t buy hoping for a miracle immediately. If you have the money (not borrowed) and the patience, we need not tell you to buy,” said an analyst with a leading broking firm.

Analysts blamed the global sell-off triggered by the US credit worries for the fall in Indian stocks. The Indian market has been moving in tandem with other world markets in the last one month. Japan’s Nikkei index sank 3.7 per cent to close at 11,787.51 points, its lowest in more than 2 1/2 years. Hong Kong’s Hang Seng index fell 5.2 per cent to finish at 21,084.61. Across the Asia-Pacific region, all major stock indexes were down, including markets in Australia, China, South Korea, Indonesia and the Philippines.

The latest round of selling was triggered after JP Morgan on Sunday acquired Bear Stearns for $ 236.2 million (euro151.8 million) in a deal that represents a stunning collapse for one of the world’s largest and most venerable investment banks.

Moreover, a fall in the dollar to a record low against the euro, sent spot gold and crude futures hurtling towards record highs of $ 112 per barrel, deepening concerns of rising inflationary pressures throughout the Asian region. Inflation in India is already ruling above the 5 per cent level. Finance Minister P Chidambaram said in Parliament that there was tremendous pressure on the government to fight inflation. There is still a mismatch between the demand and supply of food articles, he said, which was adding to price pressures.

The Sensex has already fallen over 5,000 points in the last two months, largely due to the global credit market concerns. Most of the blue chips have fallen by 25-35 per cent during this period due to intense selling pressure.

The fear factor

• JP Morgan buyout of Bear Stearns rattles investors

• US emergency cut in discount rate adds to nervousness

• Most global markets fall 3-6 per cent on intensifying credit market worries

• Dollar plunges further, gold and crude oil rally

•In India, ICICI Bank leads the bear rout