MARKET, ~ FALL ON IND0-PAK TENSION

Domestic stocks and the rupee weakened on Tuesday after investors turned cautious, following the flaring up of tensions with Pakistan. The suspected terrorist attack in the United Kingdom (UK) and reports against the Trump administration on collusion with Russia also weighed on the investor sentiment.

Domestic stocks and the rupee weakened on Tuesday after investors turned cautious, following flaring up of tensions with Pakistan. The suspected terrorist attack in the UK and reports against the Trump administration on allegedly colluding with Russia also weighed on investor sentiment.

The benchmark BSE Sensex lost 205 points, or 0.67 per cent to close at 30,365, while the National Stock Exchange’s Nifty closed at 9,386, down 52 points or 0.55 per cent. The broader market saw a steeper correction with the BSE Midcap Index dropping 1.6 per cent. The rupee fell 0.53 per cent to close at 64.89 against the dollar.

The Indian Army, during trading hours, announced it had entered the Pakistancontrolled region of Kashmir to destroy terrorist camps. On Tuesday, the markets opened weak but had erased most of the day’s losses ahead of the army’s announcement.

“Factors like these always create some nervousness in the market. During the last hour of trading, we saw a bout of selling by investors due to the brewing tensions between India and Pakistan. If the situation escalates further, it could trigger a correction in the markets. However, the impact would depend on how long the issue will stretch out,” said Rikesh Parikh, vice-president, corporate broking, Motilal Oswal Financial Services.