Sensex drops nearly 5 percent on interest rate hike in India

| April 2, 2007 | 0 Comments
Sensex drops nearly 5 percent on interest rate hike in India

Equities markets in the Asia Pacific region were mixed on Monday. In India, the Sensex dropped 4.72 percent to 12,455.37, losing 616.73 points on the session. In Australia, the Sydney Ordinaries dropped 1.18 percent to 5,908.2, a decline of 70.6 points. The S&P/ASX200 index fell 79.2 points to 5,915.8. The equities markets were lower in Tokyo as well. The Nikkei 225 dropped 1.5 percent to 17,028.41 after falling below the 17,000 level at one point during the session. The Topix index fell even further, closing 1.8 percent lower, to 1,683.49. On the other hand, the Hang Seng index in Hong Kong added 0.04 percent to 19,809.7, while in Singapore the Straits Times index gained 0.71 percent to 3,238.73.

In Europe, the markets were higher on the session. The FTSE Eurofirst 300 and the Xetra Dax each added 0.29 percent, to 1,519.98 and 6,937.17 respectively, while the CAC-40 was 0.2 percent higher in Paris, to 5,645.56. London saw gains as well, with the FTSE 100 up 0.12 percent to 6,315.5 and the FTSE 250 adding 0.6 percent to 11,759.9.

By mid-afternoon in New York, Wall Street was mixed. The Dow Jones Industrial Average was barely in positive territory but still down 0.8 percent for the year so far at 12,357.76 and the S&P 500 was 0.1 percent higher to 1,421.67, but the Nasdaq Composite had dropped 0.3 percent to 2,413.65.

Late in the day in London, the price for Brent crude was higher but West Texas Intermediate was lower at early afternoon in New York. Meanwhile, the price of gold dropped but copper and nickel saw advances.

In the currency markets, the Australian dollar hit a 10-month high in relation to the US dollar ahead of a meeting by the Reserve Bank of Australia as most analysts expect that the Bank will raise interest rates and as new data showed retail sales higher in February. The euro and sterling were also higher versus the greenback.

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