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Sensex suffers for 6th day, grazes two-month low

Sensex suffers for 6th day, grazes two-month low
Falling for the sixth straight day on Friday, the BSE benchmark Sensex tumbled 162 points to end at nearly two-month low on late selling in realty, banks and auto shares as the RBI dashed hopes of an early rate cut saying inflation is still 'quite high'.

Weak trends in global markets on Eurozone debt worries and the rupee trading above 55-levels against the dollar also hit the sentiment. After a better start at 18,563.32, the Sensex erased early gains after selling in rate-sensitives gathered pace in the last half hour of trading. The 30-share Sensex closed 162 points, or 0.88 per cent, lower at 18,309.37. 'At 7.45 per cent inflation is certainly quite high,' RBI Governor D Subbarao said, adding the central bank is always on 'high alert' on the inflation front.

After headline inflation fell to an 8-month low of 7.45 per cent in October, investors had hoped for a rate cut in December when RBI reviews the monetary policy, said traders. ICICI Bank lead the 24 losers in 30-share Sensex, followed by Tata Motors, SBI, Bhel, Maruti and HDFC.

Analysts said the rupee falling against dollar and worries over slowing global growth further forced investors to sell holdings. The mood also turned cautious ahead of the Winter session of Parliament which starts on 22 November. The important economic agenda for the session includes amendment to the Insurance Bill to raise FDI cap from 26 to 49 per cent, Banking Regulation Amendment Bill and Direct Taxes Code.
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