The sell-off in stock markets in the last week was linked by most marketmen to the downslide on the NASDAQ. However, even when the NASDAQ rebounded in the last two days, the selling pressure in the domestic markets was relentless. This can be attributed largely to the heavy selling by fund managers to meet mounting redemptions.

As equity markets faced one of their worst slumps ever, so did growth funds. As just as nervous equity investors sold equities, nervous growth fund investors sold growth funds. This explains why most fund managers have been selling in a big way over the past few days. And if redemption pressure is sustained at current levels, with no sign of fresh inflows, fund managers will continue to sell.

Figures released by the Securities & Exchange Board of India (SEBI) reveals the heavy off-loading by fund managers since 12th April 2000.

Off-loading by fund managers  

(Rs m)	Net Sales	BSE Sensex
19-Apr	76.6	4,665.0
18-Apr	1,087.1	4,744.9
17-Apr	1,138.5	4,879.0
13-Apr	189.6	5,169.0
12-Apr	606.2	5,427.0

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