The Bombay Stock Exchange benchmark Sensex on Tuesday (January 22, 2008) tumbled by 2,029 points, or 11.53 per cent, leading to suspension of trading on the bourse for an hour. This was the fourth time in the history of Indian stock market that the trading has been halted.
Why suspend trading?
* According to norms, if the stock market witnesses a movement of 10 per cent on either side, the trading has to be suspended for an hour.
* Based on the closing level of 20,286.99 points on December 31, the circuit limit is 2,028 points.
* If the Sensex hits the 10 per cent circuit limit again, trading will be halted for another two hours.
Earlier meltdowns
* This is the fourth instance that the market has hit 10 per cent lower circuit. The Sensex is down 25 per cent, Nifty, down 28 per cent and CNX Midcap is down 31 per cent from its life-time highs.
* The first time was during the Harshad Mehta scam in 1992;
* Then in 2004, when the NDA lost to the Congress ;
* In October 2007, when the P-Note issue was on.
The 30-share barometer tumbled 2,029.05 points to 15,576.30 within minutes of start of trading. The 30-share barometer had yesterday (January 21, 2008) lost 1,408 to 17,605.35 points on concerns regarding the US economy going into recession. Similarly, the wide-based National Stock Exchange index Nifty plunged 12.10 per cent or 639.30 points to 4,569.50.
Cumulative losses
The Sensex has lost 25 per cent since January 10, 2008, when it hit its peak of 21,206.77 points. Nifty has come 28 per cent below its high of 6,357.10, reached on January 8, 2008.
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