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Stock markets continue to crash

By Our Special Correspondent

NEW DELHI, MARCH 9. The preventive measures by the Securities and Exchange Board of India (SEBI) notwithstanding, major stock exchanges in the country continued to crash on Friday, almost a repeat of the ``black Friday'' of March 2.

However, this time, the crisis has been triggered off by a problem at the Kolkota Stock Exchange where four prominent brokers failed to come up with payments early in the day.

By evening, the situation had been somewhat brought under control.

While the Sensex dropped 176 point on March 2, today the drop at the close of the day was 175 points from the previous closing.

In the morning, however, the Sensex plunged by about 235 points in Mumbai, but things improved once information came from Kolkota that the payment crisis was being brought under control.

The crisis was reported to be of the order of Rs. 96 crores, but the exchange authorities, in a swift move, opened the bourse on a closed day (due to Holi) and by evening managed to bring down the shortfall to about Rs. 45 crores. The authorities were confident that the crisis would be over today.

The plunging Sensex saw a reflection in almost all the major bourses, including Delhi, Chennai and Kolkota.

Even foreign institutional investors retreated in the face of the falling market, triggered by the crisis.

-- Martin Thompson (, March 10, 2001


Calcutta payment crisis triggers crash on BSE

MUMBAI, MARCH 9. The `black Friday' scene was enacted again amidst apprehensions of payment crisis triggering a virtual collapse in share values on the Bombay Stock Exchange today on a fresh wave of selling.

As a result, the BSE sensitive index which opened weak at 3986.82 later plunged to the intra-day low of 3821.59 on relentless selling before eventually ending at 3881.96 against yesterday's close of 4056.94, a whopping fall of 174.98 points. Reports of payment default on the Calcutta Stock Exchange made operators and speculators in Mumbai so much jittery that they rushed frantically to wind up their long outstanding positions.

No payment crisis: Mehta MUMBAI, MARCH 9. The Securities and Exchange Board of India Chairman, Mr. D. R. Mehta, today asserted that there `is no payment crisis' at the Calcutta Stock Exchange (CSE).

``The liabilities at the CSE are manageable and the settlement will be smooth and the outstandings of Rs. 47.50 crores will be cleared by this evening,'' Mr. Mehta told newspersons when asked about the payment crisis there which triggered the crash in share values at the major bourses.


-- Martin Thompson (, March 10, 2001.

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