Sensex plunges 572 pts on global sell-off, weak rupee
While all sectoral indices on BSE and NSE ended in the red, led by metal, oil and gas, pharma and financial stocks, the rupee fell to an intra-day low of 71 per dollar-mark
MUMBAI: Benchmark equity indices cracked for the third consecutive session Thursday on negative global cues, weak rupee and sustained selling by foreign as well as domestic institutional investors.
The BSE Sensex plunged 572.28 points, or 1.59%, to close at 35,312.13. Similarly, the broader NSE Nifty fell 181.75 points, or 1.69%, to 10,601.15.
All sectoral indices on the BSE and NSE ended in the red, led by metal, oil and gas, pharma and financial stocks.
The rupee was trading 36 paise lower at 70.82 against the US dollar intra-day. The currency fell to an intra-day low of 71 per dollar mark amid strengthening American currency and weak domestic equity market.
Global investor sentiment was weak as the chances of peaceful trade negotiations between the US and China dimmed on news that Huawei chief financial officer Meng Wanzhou had been held in Canada and faces extradition to the US over alleged Iran sanctions breaches by the firm.
All sectoral indices were trading with losses, led by metal, oil and gas, realty, FMCG (fast-Moving consumer goods), auto and banking stocks.
Top losers include Vedanta, Bharti Airtel, Tata Steel, Yes Bank, Maruti, IndusInd Bank, ONGC, ICICI Bank, Tata Motors, Kotak Bank and NTPC, falling up to 3%. While, gainers include Sun Pharma, PowerGrid and L&T, rising up to 2%.
Domestic investor sentiment was also weak after the Reserve Bank of India (RBI) on Wednesday expectedly kept interest rates unchanged. “From a market stand point, the expectation of a more accommodative view from RBI, in line with similar view on the US Fed rate trajectory was a disappointment, which explains the post announcement volatility,” said Dhananjay Sinha, head of research, economist and strategist, Emkay Global Financial Services.
On a net basis, foreign portfolio investors (FPIs) sold shares worth ₹357.82 crore Wednesday, and domestic institutional investors (DIIs) were net sellers to the tune of ₹791.59 crore, provisional data available with BSE showed.
Oil prices extended losses ahead of the meeting of Opec and non-Opec production companies. Brent crude, the international benchmark, was trading 0.83% lower at $61.05 per barrel.
Elsewhere in Asia, Hong Kong’s Hang Seng was down 2.26%, Japan’s Nikkei fell 2.06% and Shanghai Composite Index edged lower by 1.28% in early trade.
Wall Street was closed for trade on Wednesday. the Dow Jones Industrial Average index cracked 799.36 points, or 3.10%, to 25,027.07 on Tuesday.
Global stock markets slumped for a third day running on Thursday as the arrest of a top executive of Chinese tech giant Huawei in Canada for extradition to the US fed fears of fresh tensions between the two economic superpowers. The arrest of Huawei’s chief financial officer Meng Wanzhouof, who is also the daughter of the firm’s founder, triggered renewed fireworks coming just as Washington and Beijing prepare for crucial trade negotiations. Asian markets took a beating. Huawei is not listed but China’s second-largest telecom equipment maker ZTE Corp. sank 9% in Hong Kong while most of the nearby national bourses lost at least 2%.
London, Frankfurt and Paris then slumped to 2-year lows as tech companies, banks and carmakers fell nearly 3%.
Oil stocks headed for their worst day in 2 1/2 years as crude prices spilled as much as 5% going into an Opec meeting in Vienna.
“We had this very ugly new turn and just the degree to which the market has reacted just suggests to me that they are vulnerable right now,” said John Hardy, Saxo Bank’s head of FX strategy. “It think we should all be very careful. It is not looking good, especially if the S&P 500 goes to new lows.”