100 Cr is Being Losed by Dalal Street every 5 Minutes

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MUMBAI: After a whopping loss of over Rs 40,00,000 crore in 2008, the stock market is continuing its free-fall and investors have lost an average of Rs 100 crore in every five minutes of trade in first two months of 2009.

Cumulatively, the total investors’ wealth has got eroded by about Rs 2,82,000 crore so far this year.

However, the meltdown has been less severe so far this year, as compared to 2008 when an average of Rs 100 crore was wiped off in just two minutes of trade, as per an analysis of stock market losses during 2008 and first two months of 2009.

During 2008, the total investors’ wealth, measured in terms of cumulative market capitalisation of all the listed companies, plummetted from close to Rs 72,00,000 crore to about Rs 31,00,000 crore.

So far in 2009, the investors’ wealth on Indian bourses has gone further down to about Rs 28,60,000 crore, as per the current market value of the listed companies.

There were a total of 246 trading sessions in 2008, while so far in 2009 trades have been conducted on 39 days.

Taking into account a trading session of five hours and 35 minutes every day (markets open at 0955 hours and close at 1530 hours), an average of Rs 20 crore has been lost in every minute of trade so far this year.

This average was, however, more than double at Rs 50 crore in every minute of trade in 2008.

In terms of Sensex movement, the benchmark index has lost more than 750 points in first two months of 2009. During the entire 2008, the Sensex plummetted by more than 10,000 points.

However, if we take into account the price-earnings ratio, the Indian market seems to have become a bit more expensive in the first two months of 2009. It had become cheaper by more than half during 2008 by this measure.

The price-earnings ratio of the Sensex currently stands at 12.82, which is higher than 12.16 at the beginning of the year. However, it had fallen sharply during 2008 from 26.94 at the end of the previous year.

Source: www.nhatky.in

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