Saturday, October 22 2005 13:50 Hrs (IST) - World Time -

Mumbai: Appreciating dollar and Foreign Institutional Investors (FII) withdrawals alternated by impressive second quarter corporate earnings caused high volatility on bourses during the week and the Sensex tumbled by another 1.62 per cent even as Friday's relief rally provided required respite to the market.

The market sought lower levels every day on fears of FII pull out following a sharp depreciation in rupee to below 45 level a dollar and sustained negative activity by FIIso far in October.

In the week to October 22, the Bombay Stock Exchange (BSE) Benchmark 30-share Index (Sensex) swung by 480 points between 8317.38 and 7838.02 in extremely erratic movements before ending the week at 8068.95 from last weekend's close of 8201.73, a net fall of 132.78 points.

The massive slide in Sensex in October was attributed to falling rupee and indication of measured hikes in US interest rates that led to fairly heavy withdrawals by FIIs.

FIIs aggressively hedged positions in Futures while making net sales of Rs 790.6 crore in the first four days of week taking the total withdrawal figure to Rs 1462 crore so far in the month.

Domestic Mutual Funds, however, made net purchases of Rs 1173 crore in a bid to salvage the market situation.

The market had staged a strong pullback rally at the weekend on hectic short covering and the Government's fresh initiatives on reforms.

The market seemed to have bottomed out from the 7850-7900 resistance level and expected to stabilize above 8000 level as economic fundamentals are strong amid robust second quarter performance by corporates.

The Government's assurance on financial sector reforms with moderate and reasonable tax rates for industry and on hike in Foreign Direct Investment (FDI) ceiling in Telecom sector is expected to boost the market sentiment during next week.

Among other indices, the broad-based BSE-100 Index dipped further by 94.60 points to end the week at 4257.06 from last weekend's close of 4351.66.

The BSE-200 Index and the Dollex-200 were quoted sharply down at 1022.34 and 377.49 at the weekend compared to previous weekend's close of 1048.01 and 388.69 respectively.

The BSE-500 Index fell sharply by another 92.94 points to finish the week at 3268.62 from preceding weekend's close of 3361.56 and the Dollex-30 ended the week substantially lower at 1469.20 from 1500.03 at the last weekend.

On the National Stock Exchange (NSE), the S&P CNX Nifty dropped sharply by 40.65 points and 43.00 points to end the week at 2443.75 and 1872.10 from last weekend's close of 2484.40 and 1915.10 respectively. The S&P CNX Nifty Junior nose-dived by 268.30 points to conclude the week at 4801.30from 5069.60 at the last weekend.

During the week, the volume of business on the BSE and the NSE spurted sharply to Rs 15,646 crore and Rs 32,764 crore from last week's turnover of Rs 11,163 crore and Rs 22,671 crore respectively.