Sensex ends in red after 1,000 pt crash
MARKET BLUES Investors jolted by a sudden midsession plunge amid a massive selloff in NBFC stocks
Benchmark indices finished with losses Friday after investors were jolted by a sudden mid-session plunge amid a massive sell-off in NBFC stocks.
The BSE Sensex, which opened on a strong footing, suddenly tanked 1,127.58 points, or 3.03%, to hit a low of 35,993.64 in afternoon trade, before staging an equally sharp recovery within minutes. It finally closed at 36,841.60, down 279.62 points. It saw an intra-day swing of 1,495.60 points.
The broader NSE Nifty shed 91.25 points to finish at 11,143.10. The indices closed in the red for the fourth day in a row, during which investors lost a massive ₹5.6 lakh crore.
Shares of housing finance firms slumped, with Dewan Housing Finance tumbling up to 42% on fears of a liquidity crisis. Reports of debt defaults by IL&FS also sparked concerns, which spilled over into other NBFC counters. Yes Bank was the worst performer in the Sensex pack, losing a whopping 28.71%, after the RBI curtailed the term of its founding CEO Rana Kapoor.
The indices closed with losses for the third straight week. The Sensex lost a hefty 1,249.04 points, or 3.28%, while the NSE Nifty fell 372.10 points, or 3.23%, during the week. Foreign portfolio investors (FPIs) remained net sellers and offloaded equities worth ₹2,184.55 crore while domestic institutional investors (DIIs) made purchases worth a net ₹1,201.30 crore Wednesday, provisional data showed.
“The events surrounding Yes Bank and DHFL sent the broader markets sharply lower. The trigger on the surface seems to be the selling of debt papers of DHFL by one of the prominent AMCs, but the broader issue is that of a contagion leading to selloff in papers of other companies,” said Joseph Thomas, head of research—wealth management, Emkay Global Financial Services.
Other major index losers were Kotak Bank 3.86%, Adani Ports 2.94%, Maruti Suzuki 2.04%, Infosys 1.96%, Sun Pharma 1.82%, Coal India 1.75%, HUL 1.65%, NTPC 1.03%, Tata Motors 0.99%, Bajaj Auto 0.16% and Vedanta 0.13%.
ONGC was the top gainer, spurting 1.95%, followed by Wipro 1.38%, ITC 1.37%, TCS 1.30%, Asian Paints 1.07%, M&M 1.05%, and PowerGrid 1.03%, among others.
Sector-wise, realty plunged 3.48%, banking 3.13%, finance 2.51%, power 1.91%, healthcare 1.66%, auto 1.18%, IT 1.08%, infrastructure 0.85%, teck 0.76%, FMCG 0.74%, consumer durables 0.68%, capital goods 0.61%, metal 0.42% and PSU 0.42%. Oil and gas rose 1.50%.
In the broader markets, the BSE small-cap index dived 3%, while the mid-cap gauge lost 1.72%.
Globally, most Asian and European markets rose, tracking positive closing in the US market overnight on easing trade war concerns. In the Asian region, Hong Kong’s Hang Seng was up 1.73%, Shanghai Composite Index edged higher by 2.50% while Japan’s Nikkei gained 0.82%. In the Eurozone, Paris CAC 40 was up 0.68% and Frankfurt’s DAX advanced 0.70%. London’s FTSE too was up 1.08%.
MUMBAI: