The domestic stock markets, which remained generally firm up to early January 2008, witnessed a sharp correction beginning January 11, 2008.
Liquidity support from foreign institutional investors (FIIs), strong macroeconomic fundamentals, healthy corporate earrings, upward trend in equity markets and other sector and stock specific news helped to boost the market sentiment during April-December 2007.
Although the domestic stock markets during this period witnessed corrections in mid-August, mid-October and mid-December 2007, they again recovered to reach new high.
Reflecting this, the BSE Sensex reached an all-time high of 20873.33 on January 8, 2008.
Beginning January 11, 2008, the domestic stock markets witnessed severe bouts of volatility due to heightened concerns over the severity of sub-prime lending crises in the US and its spill-over to other market segments and in other countries.
Fears of recession in the US economy on account of contraction in the US service industry, weak earnings growth reported by some of the leading US companies, home foreclosures climbing to record high levels and lackluster retail sales in the US also impacted the sentiment.
Liquidity squeeze from the secondary market in the wake of the IPO issuances, heavy sales by FIIs in the Indian equity market, hike in short-term capital gains tax from 10 per cent to 15 per cent announced in the Union Budget 2008-09, increase in domestic inflation rate, rise in global crude oil prices to record highs were some of the other factors that adversely affected the market sentiment.
Between end-March 2007 and March 31, 2008, the BSE Sensex moved in a wide range of 12455.37 - 20873.33.
The BSE Sensex and the S&P CNX Nifty, closed at 15644.44 and 4734.50, respectively, on March 31, 2008 registering gains of 19.7 per cent and 23.9 percent, respectively, over end-March 2007. The BSE sensex was 16698.04 on April 23, 2008.
According to the data released by the Securities and Exchange Board of India (SEBI), FIIs have invested Rs.52,574 crore (US $ 12.7 billion) in the Indian stock markets during 2007-08 as compared with net purchases of Rs.26,031 crore (US $ 5.7 billion) during 2006-07. Between April 1, 2007 and January 8, 2008, FIIs invested Rs.66, 898 crore (US $ 16.3 billion) in the Indian stock markets.
However, FIIs made net sales of Rs.14, 324 crore (US $ 3.6 billion) between January 9, 2008 and March 31, 2008. Mutual funds made net investments of Rs. 15,775 crore during 2007-08 as compared with net investments of Rs.9, 062 crore during 2006-07.
The major gainers in the domestic stock markets during 2007-08 were metal,
Oil and gas, capital goods, fast moving consumer goods, public sector undertakings, banking and consumer durables sector stocks.
Liquidity support from foreign institutional investors (FIIs), strong macroeconomic fundamentals, healthy corporate earrings, upward trend in equity markets and other sector and stock specific news helped to boost the market sentiment during April-December 2007.
Although the domestic stock markets during this period witnessed corrections in mid-August, mid-October and mid-December 2007, they again recovered to reach new high.
Reflecting this, the BSE Sensex reached an all-time high of 20873.33 on January 8, 2008.
Beginning January 11, 2008, the domestic stock markets witnessed severe bouts of volatility due to heightened concerns over the severity of sub-prime lending crises in the US and its spill-over to other market segments and in other countries.
Fears of recession in the US economy on account of contraction in the US service industry, weak earnings growth reported by some of the leading US companies, home foreclosures climbing to record high levels and lackluster retail sales in the US also impacted the sentiment.
Liquidity squeeze from the secondary market in the wake of the IPO issuances, heavy sales by FIIs in the Indian equity market, hike in short-term capital gains tax from 10 per cent to 15 per cent announced in the Union Budget 2008-09, increase in domestic inflation rate, rise in global crude oil prices to record highs were some of the other factors that adversely affected the market sentiment.
Between end-March 2007 and March 31, 2008, the BSE Sensex moved in a wide range of 12455.37 - 20873.33.
The BSE Sensex and the S&P CNX Nifty, closed at 15644.44 and 4734.50, respectively, on March 31, 2008 registering gains of 19.7 per cent and 23.9 percent, respectively, over end-March 2007. The BSE sensex was 16698.04 on April 23, 2008.
According to the data released by the Securities and Exchange Board of India (SEBI), FIIs have invested Rs.52,574 crore (US $ 12.7 billion) in the Indian stock markets during 2007-08 as compared with net purchases of Rs.26,031 crore (US $ 5.7 billion) during 2006-07. Between April 1, 2007 and January 8, 2008, FIIs invested Rs.66, 898 crore (US $ 16.3 billion) in the Indian stock markets.
However, FIIs made net sales of Rs.14, 324 crore (US $ 3.6 billion) between January 9, 2008 and March 31, 2008. Mutual funds made net investments of Rs. 15,775 crore during 2007-08 as compared with net investments of Rs.9, 062 crore during 2006-07.
The major gainers in the domestic stock markets during 2007-08 were metal,
Oil and gas, capital goods, fast moving consumer goods, public sector undertakings, banking and consumer durables sector stocks.