Stocks fall to a 5month low amid global selloff
MARKET WOES Sensex drops 1.24% to 32,596.54; Nifty falls 1.15% to 9,998.05 MUMBAI:
The BSE Sensex plunged by about 410 points to close at a five-month low while the broader Nifty crashed below the 10,000 mark for the first time this year following a global selloff due to fears of a trade war as US President Donald Trump announced tariffs on Chinese goods.
The 30-share Sensex tumbled by 409.73 points or 1.24% to close at a five-month low of 32,596.54, a level last seen on October 23 last year.
The 50-issue Nifty ended below the psychological 10,000level by dropping 116.70 points or 1.15% to 9,998.05, the lowest closing level in five months. The level was last seen on October 11 last year, when it had closed at 9,984.80.
Investors lost around ₹1.57 lakh crore in market valuation on Friday.
For the fourth straight week, the flagship Sensex recorded a fall of 579.46 points, or 1.75%, while the NSE Nifty lost 197.10 points, or 1.93%.
Realty, metal, bankex, capital goods, healthcare, PSU, auto and oil & gas stocks recorded widespread losses.
Metal stocks led by SAIL, Jindal Steel, Vedanta, Hindalco Ind. Jindal Steel, National Aluminium, Hindustan Zinc, Tata Steel, NMDC and JSW Steel fell up to 6.58% due to intense selling pressure.
Banking stocks took a hit after Totem Infrastructure was booked by the CBI for allegedly defrauding a consortium of eight banks led by Union Bank to the tune of ₹1,394 crore.
The Nifty Bank index fell 471.10 or 1.95% to close at around eight-month low of 23,670.40 as Axis Bank, PNB, Yes Bank, Canara Bank, ICICI Bank, IDFC Bank, SBI, Bank of Baroda, HDFC Bank, Kotak Bank, Federal Bank and IndusInd Bank dropped up to 3.87%.
Union Bank of India also ended lower by 8.29 % to ₹86.85 amid concerns over losses incurred in a ₹1,394-crore loan fraud case.
Investor sentiment turned extremely bearish, in line with sharp losses on the Wall Street, Asian and European markets, on growing fears of a global trade war after Donald Trump imposed tariffs on Chinese imports and Beijing drawing up a list of retaliatory measures, brokers said.
The markets opened with a negative bias as global trade war tensions intensified after US President Donald Trump ordered at least $50 billion in tariffs on Chinese imports and China announced plans for reciprocal tariffs on $3 billion of imports from the US, Anand Shah, Deputy CEO & Head of Investments — BNP Paribas Mutual Fund said.
Vinod Nair, Head of Research, Geojit Financial Services Ltd said, “Volatility expanded and market is losing its grip due to escalating tensions of trade war and spike in oil prices.”
“Market corrected 10% from its peak while metal & PSU banks continue to be the laggards. We expect domestic chaos to stabilize as pressure of redemption will be over by the end of FY18 but pre-election volatility may take some time.”
In the Sensex kitty, Tata Motors, L&T, Bajaj Auto, Dr Reddy’s RIL, Wipro, HDFC, Sun Pharma, Heromotocorp, HUL, Maruti Suzuki, Bharti Airtel, ONGC, ITC, TCS and NTPC, lost up to 2.10%.