The BSE benchmark Sensex on Friday plunged over 414 points, logging its biggest single-day drop in over 3 weeks, to end at 25,480.84 on across-the-board losses in bluechips amid a global sell-off.
On Thursday, the US markets cracked after Argentina announced that it had defaulted on its debt. The Dow Jones closed 1.88% lower, while Nasdaq ended 2.09% lower on Thursday.
Experts say Indian stock markets are looking for concrete policy measures from the new government. “Earlier we were seeing re-rating in anticipation of policy decisions. Now, markets want government to deliver,” said Gaurav Mehta, VP, institutional equities, Ambit capital. He added that apart from global cues, Friday’s fall could be attributed to the continued underperformance seen in broader markets and increased supply due to rising number of QIPs. “While we are still in a market, the current correction could take Nifty till 7,100,” he said.
The Sensex after opening lower at 25,753.92, dipped to 25,459.13 on across-the-board selling. It ended at 25,480.84, down 414.13 points, or 1.60 per cent — its biggest fall since July 8 when it tanked 518 points after railway budget.
The BSE barometer had lost 192.45 points on Thursday.
The Sensex finished the week with a loss of 646 points, snapping two weeks of successive gains.
With dollar gaining strength against most global peers, the rupee breached the 61-mark to trade at over three-month low of 61.17 (intra-day). After US Fed trimmed monthly stimulus, fears have heightened that inflows into emerging markets would slow. All eyes are on a US non-farm payroll report to be released later on Friday for more cues, said brokers.
Meanwhile, the 50-share NSE Nifty dipped below 7,600 mark by plunging 118.70 points, or 1.54 per cent, to end at 7,602.60. Intra-day, it shuttled between 7,716.70 and 7,593.90 intra-day.
“Markets sold off in the second half of the day to close 1.5 per cent lower. Weak global markets and continuing geo-political tensions rode over the positive core sector growth data released in India on Thursday,” said Dipen Shah, Head- Private Client Group Research, Kotak Securities.
European indices were trading 1-2 per cent lower. Asian markets closed up to 1 per cent down as global sell-off spread.
“Lower inflation in EU, expectations of earlier than expected rise in US interest rates, default by Argentina and some lower-than-expected quarterly results in India soured sentiments,” he added.
There was also continued profit-booking in recent out-performers such as oil and gas, metal, power, capital goods and banking, PSUs, realty and consumer durable stocks.
Out of the 30-share Sensex, 25 stocks closed with losses led by RIL and ONGC. Just five counters ended higher.
Sectorally, the BSE Consumer Durables sector index suffered the most on Friday by plunging 3.27 per cent, followed by Oil and Gas (2.16 per cent), Metal (1.90 per cent), Capital Goods (1.90 per cent) and Power (1.87 per cent), among others.
Meanwhile, Foreign Portfolio Investors sold shares worth a net continued…