The Hindu : Business : Market ends flat despite Citi’s bailout package

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Tuesday, Nov 25, 2008
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Market ends flat despite Citi’s bailout package

Profit taking pulls down Sensex

MUMBAI: The Bombay Stock Exchange 30-share sensitive index (Sensex) closed flat after regaining the 9000-level in intra-day as the rescue package by the U.S. administration for the financial giant Citigroup failed to spark any major buying activity amid mixed trends in Asia.

The Sensex settled the day at 8903.12, a meagre fall of 12.09 points from its previous close. The National Stock Exchange index, Nifty, however, closed marginally higher by 14.80 points at 2708.25.

After opening lower, the Sensex bounced back to regain the 9000-level on buying triggered by the U.S. government’s $20 billion fresh capital infusion and $306 billion guarantee in assets to the crisis-ridden Citigroup.

However, profit taking at every surge pulled down the Sensex, diluting the positive impact of a rescue package for the Citigroup. Marketmen said the U.S. government’s decision to bailout the Citigroup eased to an extent the gloomy outlook but investors were unwilling to build fresh positions as other indications from global financial markets were weak. They said the bailout package for the global financial giant did not really enthuse sentiment as investors remained nervous as the U.S. bank had large portfolio holdings in many Indian companies. Investors feared that Citi might have to liquidate them if problems got worsened.

Rupee loses 7 paise

The rupee on Monday ended weaker by seven paise at 50.09/10 against the U.S. currency on sluggish equity market and consistent capital outflows. In fairly active trading at the interbank foreign exchange market, the domestic currency resumed weak at 50.04/05 against its previous close of 50.02/03, before moving between 49.96 and 50.25.

The rupee attempted a smart recovery at the day’s high in sync with domestic stocks after the U.S. government announced a $20 billion fresh capital infusion for the troubled banking giant Citigroup.— PTI

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