Sensex slumps further on poor poll show by Congress

The Bombay Stock Exchange's sensitive index (Sensex) declined nearly 118 points in morning trade today, the third consecutive day of freefall, after a poor showing by the Congress in state elections.

The country's benchmark 30-share index fell 1.1 per cent on Tuesday to 17,173.29, its lowest closing in more than five weeks. This morning it moved down further by 0.69 per cent to 17,055.46 points.

The falling trend has been triggered not only by the election results but also by a general downturn in Asian markets after a weak overnight showing on the Dow Jones. Continuing uncertainty over a bailout for Greece, and the general slowdown in global economies, has dampened sentiment across markets.

Indian investors are weighing the options between the cut in the cash reserve ratio (CRR) promised by the Reserve Bank of India and the probability of economic reforms being further stalled due to a politically weakened central government, experts suggest.

Finance minister Pranab Mukherjee is slated to unveil the union budget for 2012-13 on 16 March.

In the Asia region, Hong Kong's Hang Seng index fell 1.23 per cent and Japan's Nikkei index by 1.33 per cent in morning trade today. The US Dow Jones Industrial Average ended 1.57 per cent lower in Tuesday's trade.