Sensex down by 230 points on FII sell-off
Mumbai: As foreign institutional investors unleashed a mid-session wave of selling, the 30-scrip BSE sensex lost 230 points on Monday. The selling was motivated by fears of a US Federal Reserve interest rate hike and the repercussions of the drought in some Indian states. The S&P CNX Nifty opened at 1423.25, hit a high of 1436.60, dipped to a low of 1358.80 and ended the day at 1365.05, losing 57.35 points form its previous close of 1422.40.

The reversal came at a time when the investors had hoped that the market had bottomed out and that it was heading for an upturn. Despite opening firm, with a jump of more than 50 points over its previous level at 4744, the sensex slipped dramatically to end at 4463, a net loss of 230 points or 4.91 per cent.

Positive news such as the handsome growth in corporate earnings, the substantially low badla rates and firmer trends on the tech-heavy Nasdaq failed to improve sentiment. On Monday, declines led advances by 687 to 676. However, analysts have begun to express concern about the fate of several consumer products companies, many of whose next quarter results would be affected by the drought-like conditions prevailing in many parts of the country.

The major losers included Infosys (11 per cent), DSQ Software (12 per cent), Polaris Software (8 per cent), HCL Technologies (5 per cent) and Zee Telefilms (8 per cent). However, select infotech and telecom stocks like Himachal Futuristic, Global Tele-systems, Aftek Infosys, Sonata Software and BFL Sofware recorded sharp gains.
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Government will accord FII status to foreign venture capital funds
Calcutta : In a statement made by the Sebi chairman, Mr. D. R. Mehta, it appears that the government has taken an in-principle decision to give foreign venture capital investors the parallel status of foreign institutional investors. This will give foreign venture funds the benefits of capital account convertibility and enable them to play the Indian primary market.

Mehta was very upbeat about the future of foreign funds in India, and believes that if the necessary framework was put in place, foreign funds alone can harness investments up to $1.5 billion in the current financial year itself.

At present, the regulatory issues of foreign venture capital participation are being addressed by three agencies —the department of revenue, RBI and Sebi. The government is seriously considering making Sebi the one window clearance point for foreign funds to make it attractive for them to operate in the country.
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Board meets during trading hours may be banned
Calcutta: In a bid to control volatility in the markets, the Securities and Exchange Board of India (Sebi) is examining the issue of whether company board meetings for results and similar market sensitive information should be held during trading hours. This was stated by the Sebi chairman, Mr. D.R. Mehta, at a meeting organised by the Indian Chamber of Commerce (ICC) at Calcutta

While Sebi has already prevented listed companies from announcing results during trading hours, the regulator would examine the issue of board meets in the context of good corporate practices and how market sensitive information is to be treated.
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