Stock markets on Monday plunged over 490 points as exit polls showed BJP was facing electoral defeat in Delhi, raising concerns that the government may not gain control in the upper house of the Parliament. Sustained fund outflows also pulled down the rupee to nearly four-week low of 62.17 against the dollar.
With poor corporate results also adding to the selling pressure, the BSE Sensex fell by by 490.52, or 1.71 per cent, to end at 28,227.39, a closing level not seen since January 16.
The 30-share index has plunged from record highs losing 1,454.38 points, or 4.90 per cent, in its longest losing seven-session streak in 15 months. It hit an all-time high of 29,844.16 on January 30. The 50-share Nifty tanked 134.70 points, or 1.56 per cent, to close at 8,526.35 points.
While European and US markets too traded weak on Monday due to concerns of a possible exit of Greece from the euro zone and weak Chinese trade data, Indian markets recorded the highest fall. Foreign institutional investors also turned net sellers and sold Indian equities worth Rs 660 crore on Monday.
Market experts feel that buyers are waiting for election results to conclude. “The buyers are not entering the market and are waiting for elections to conclude. While the fall is also linked to weakness in global markets, what is going to make a difference is the Budget,” said CJ George, MD, Geojit BNP Paribas Financial Services.
Another market expert who did not wish to be named said, “It may be good for the country if AAP comes to power in Delhi as it will lead to Narendra Modi concentrate on the delivery front of all the reforms he had promised.”
The fall at BSE was led by the capital goods index that fell by 4.3 per cent following a sharp decline in Larsen & Toubro share price by 6.6 per cent after it announced a weak set of numbers. Metal and auto indices too fell by 2.5 and 2.3 per cent respectively. Among the Sensex companies Tata Steel and Sesa Sterlite were other major losers falling 5.8 and 4.5 per cent respectively.
Stocks of Delhi power utilities under pressure
MUMBAI: Shares of Reliance Infrastructure and Tata Power, which supply electricity in the national capital, came under heavy selling pressure on Monday after exit polls suggested that Aam Aadmi Party (AAP) may win Delhi polls.
The Reliance Infrastructure stock plunged 8.66 per cent to Rs 419.25 and that of Tata Power Company by 2.44 per cent to Rs 80 at the BSE.
Exit polls have suggested that an AAP government could be formed and there are widespread expectations that it may order inspection of the two discoms and also provide cheaper power in the national capital. The two stocks fell on concerns that such steps could adversely hit these companies. ENS