The BSE Sensex, the barometer of stock market, is all set to enter its silver jubilee year.
The 30 scrip index was launched by the Bombay Stock Exchange on January 2, 1986 with 1978/79 as the base year. It had closed that day at 549.43.
A booklet on the sensex released by the Exchange giving reasons for compiling the index had said, "the absence of an index number of equity prices to reflect the general trend of the market was felt for a long time by investors and also by newspapers who do not compile their own index numbers.
With this end in view, the exchange started compiling and publishing a sensitive index number of share prices from January 2, 1986."
Referring to the base year, the exchange said it was due to stability of shares prices and its proximity to the current period (launch date) prompted it to choose 1978\79 as the base year. It was earlier called as 'sensitive index' but later some analysts started referring to it as 'sensex' and it has become popular by that name.
The sensex which will be entering the 25th year on January 2, 2010 has come a long way and so also the Indian market and the economy. The composition of the index has undergone change many times. Only 11 of the original 30 companies continue to be part of the sensex.
The companies that were part of the sensex on January 2, 1986 were ACC, Ballarpur Industries, Century Spg, Bombay Dyeing, Reliance, Gwalior Rayon (Grasim), Indian Rayon, Great Eastern Shipping, Siemens, Peico Electronics (Philips), Tata Power, Tata Steel, Hindustan Aluminium, Tata Engineering (Tata Motors), L&T, Kirloskar Cummins, Premier Automobiles, Hindustan Motors, Mahindra & Mahindra, Mukand Iron, Zenith, Gujarat State Fertilisers, Indian Organic, Hindustan Lever, Glaxo, Food Specialities (Nestle), Ceat Tyres, Voltas, Indian Hotels and ITC.