MUMBAI: An estimated Rs 2.30-lakh-crore (Rs 2.30 trillion) of shareholders’ wealth has been eroded in September following the meltdown in the US financial markets, leading rating agency Crisil has said. The Indian equity market continued to slide in September with the S&P CNX NIFTY posting its second sharpest fall since January, declining around 10 per cent.

The fall in the US markets was, however, lower with the S&P 500 and Dow Jones declining by around 9 per cent and 6 per cent respectively, while emerging markets lost around 18 per cent during the month, Crisil said.

Pessimism in the financial markets following the filing for bankruptcy by Lehman Brothers, Merrill Lynch’s sell-off, the bail-out of AIG and perceived uncertainty around the US bail-out package added to investor fears, it said.
Investor sentiment was also affected on news of the possibility of Fortis filing for bankruptcy, indicating problems in the European financial markets as well.

“The BSE Realty Index and the BSE Metal Index were the most severely affected during the month, dropping by 32 per cent and 25 per cent respectively,” Crisil Research, Head-Equities, Chetan Majithia, said. “Concerns over slowing demand in the real estate market due to a liquidity crunch and increased cost of funding weighed in on investor sentiment in the realty sector,” he said.

Source: Businessline

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