The benchmark Sensex on Monday plunged 305 points to its lowest close in nearly two-and-half months amid across-the-board selling in blue chips, weak global cues and worries after the US Federal Reserve’s stimulus cut.
The Sensex dropped 304.59 points, or 1.48 per cent to end at 20,209.26, the weakest level since 20,217.39 on November 22, 2013. This was the sixth drop in seven sessions. Brokers said the foreign investors offloaded their positions after reports of slowing manufacturing in China, the world’s largest user of metals. Investors seemed to ignore data showing that India’s manufacturing sector in January expanded at the strongest pace in the past 10 months.
They said the fund managers were also worried over the US Federal Reserve’s decision to further cut monetary stimulus will tighten capital inflows into emerging markets like India. The NSE 50-issue CNX Nifty tumbled by 87.70 points or 1.44 per cent to end at more-than 2-1/2-month low of 6,001.80.
‘Jan factory activity strongest in 10 months’
India’s manufacturing sector in January expanded at the strongest pace in the past 10 months, largely driven by faster growth in export and domestic orders, an HSBC survey said on Monday.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI) — a measure of factory production — stood at 51.4 in January, up from 50.7 in December, the highest reading since March 2013. A PMI reading of above 50 differentiates growth from contraction.