Gold zooms another 1,200, sensex dives

Mumbai: Fears of another global economic slowdown led to a fresh round of selloffs in all major markets, including a 328-point fall in the sensex on Friday. At the same time, investors flocked to safer havens, thereby pushing gold prices to yet another record high. 

    For the sensex, down for the fourth consecutive week, this was the longest weekly losing streak since the collapse of Lehman Brothers in the US in September 2008. 
    The loss for the stock markets brought cheer to the bullion markets as the yellow metal is considered a hedge against economic uncertainties and inflation. 
    In Delhi, gold prices soared above the Rs 28,000 per 10-gram mark, up nearly Rs 1,200 over Thursday, closing just below 28,000. In Mumbai, it rocketed past the Rs 28,000 mark but closed at Rs 27,750, also a record high. Slowdown bug: Software scrips melt in market heat Partha Sinha TNN 
Mumbai: The rub-off effect of gold was seen in the silver market too where prices gained by over Rs 3,000 per kg to close at Rs 63,800 on Friday. In the last one month, while gold prices in India jumped nearly 21%, silver prices are up about 11%. In the international market, the yellow metal surged to a new peak to trade close to the $1,880 per ounce level while silver was trading at $42. 
    On Dalal Street in Mumbai, the overnight sell-off in the US and European markets affected investor sentiment and the sensex plunged nearly 500 points in late trading to below the 16K mark briefly. However, the index recovered from its intra-day low to close at 16,142 points, a 15-month low. 
    The day's slide in the sensex added up to nearly a 700-point loss on a weekly basis, making it the fourth consecutive week of lower closings. In 11 of the 14 trading sessions so far this month, the sensex has closed lower, during which investors' wealth, measured by the BSE's market capitalization, has gone down by nearly Rs 7 lakh crore to the current level of Rs 59.3 lakh crore. 
    In Friday's session, software stocks were the worst hit, mainly because of fears of another recession in the US, the biggest export market for Indian IT companies. As a result, compared to a 2% drop in the sensex, BSE's IT index closed 4.4% lower with most leading software companies deep in the red. 
    In Friday's session on the BSE, laggards outnumbered winners by a wide margin with 2,083 declines to 773 advances. 
    The day's session also witnessed foreign funds stepping up their selling, with BSE data showing a net outflow of a little over Rs 900 crore. This took the current month's net outflow from the secondary market to close to Rs 9,000 crore. Institutional dealers said exchange traded funds (ETFs), registered as FIIs here, led the selling on Friday. 
    "When they (ETFs) have inflows, they buy blind. When they have outflows, they sell blind," said an institutional dealer with a domestic brokerage. "Some FIIs are witnessing redemptions in their home countries, so they are forced to sell here," the dealer said.