Sensex, Nifty End In The Red To Extend Losses For Seven Straight Days

Indian equity benchmarks reversed gains from earlier in the session to extend their losses for the seventh straight session on Thursday as a boost from the British central bank started to fade as reflected by a sell-off in the pound, offset by the broader worries of global recession from higher borrowing costs worldwide. .Indeed, investors started pedalling into another cycle of selling as the dollar tightened its grip on the currency markets, recession fears weighed on stocks, and bonds continued to feel the agony of rising interest rates..The BSE Sensex index fell about 90 points to trade back below the 57,000 level, after having recovered from a six-day slump earlier on Thursday, and the broader NSE Nifty index declined over 0,3 per cent after gaining nearly 1 per cent in early trade..The Sensex had surged to a high of 57,166.14 points in the early morning session after opening at 56,997.90 points. In the afternoon session, there was intense selling pressure in the market, which caused the Sensex to fall about 650 points from its day high..Finally, the Sensex declined 188.32 points to end at 56,409.96, and the Nifty index fell 40.50 points to close at 16,818.10..For the seventh day in a row, there has been extreme selling pressure in Indian equities..While Japan's Nikkei did manage to increase by almost 1 per cent, the MSCI's broadest index of Asia-Pacific shares outside of Japan concluded the day essentially flat. Wall Street was expected to drop more than 1.2 per cent later, according to S&P 500 futures, as additional Fed policymakers were scheduled to speak..After the Bank of England (BoE) started an emergency bond-buying operation on Thursday for two weeks to stabilise the market and allay investors' fears of a financial system contagion, global equities had made a partial recovery, pushing the British pound to gain the most since mid-June..But after those gains in the previous session and an initial bounce, Thursday saw a decline in the value of the pound, the euro against a resurgent dollar as the relief over the BoE's intervention in the bond market subsided..In response to lingering concerns about Britain's economic management and the darkening prospects for global growth, the US dollar regained its footing, while the pound and the euro both declined 1 per cent.."The market wouldn't mind some stability, it has become a little bit unpredictable," Barings Investment Institute's Chief European strategist Agnes Belaisch, told Reuters..She said investors were now seeing "incoherence" in the UK with government spending as the BoE tries to rein in inflation, while everywhere else the focus is on how high central banks are prepared to go with interest rates..The open in Europe was harsh. The STOXX 600 share index fell by almost 2 per cent from the opening, while the euro and the pound, which have been badly hit by UK debt worries in recent days, both fell by 1 per cent.."Sterling is not out of the woods," DBS Currency Strategist Philip Wee, told Reuters. "The BoE is seen addressing the symptom and not the cause."."The...government has yet to address the credibility of the tax cut plans, which critics see adding to the inflation woes.".A Bloomberg report showed Friday's mini-budget from the UK had become a flashpoint for not just investors' short-term concerns about unfunded tax cuts at a time when inflation is running close to a four-decade high, or the BoE's failure to contain price growth..Reuters Graphic: UK 30-Year Bond Yields See Record Moves After BoE Intervention

Sensex, Nifty End In The Red To Extend Losses For Seven Straight Days

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