INDIA BUSINESS WORLD - JULY 2006
THE MONTH THAT WAS...

TALKS OF DOC QUITTING PULL DOWN SENSEX 258 POINTS

RUMOURS of Prime Minister Manmohan Singh's likely resignation from office sent stock prices into a tailspin on Friday, with major indices crashing over 2%. The talk was denied by the Prime Minister's Office post-market hours. On Thursday, the PM had announced a freeze on the divestment programme, bowing to pressure from coalition partners, and this fuelled rumours that he may step down in protest.

Sensex ended the day at 10,509.53, down 258.44 points or 2.4%, after touching a low of 10,440.02 intra-day. Nifty closed at 3,075.85, down 81.55 points or 2.5%.

With Friday's fall, major indices have shed close to 4% in the last couple of sessions, stoking fears that the relief rally seen over the last one week might have come to end.

Index heavyweight Reliance Industries was a major contributor to the fall, with the stock slipping 4.6% to Rs 1031.85. Indian shares were among the worst performers in Asia , where the trend was mixed. Japanese and Singapore shares ended slightly lower while South Korean, Taiwanese and Hong Kong shares closed with small gains.