Touching a two-year low, the stock market slumped nearly 6 per cent yesterday. While FinMin blames global turbulence, RBI Governor says the Indian economy is in better shape than many other countries
The benchmark Sensex yesterday took the bloodiest blow of its lifetime, crashing 1,624.51 points — its biggest single-day fall — ending below 26,000 on heavy outflows as the rupee sank 82 paise to a fresh 2-year low of 66.65.
Manic Monday: Arun Jaitley termed the market crash ‘temporary and transient’ and urged investors to not lose hope , as the government and the RBI are closely watching the situation and will soon control the mayhem. Pic/Sameer Markande
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Monday mayhem
The index ended the day 5.94 per cent down at 25,741.56 points as jittery investors sold off shares across all sectors.
This is the weakest closing for the Sensex since August 11, 2014, when it closed at 25,519.24. The barometer has now retreated by 2,190.08 in three straight sessions.
The broader NSE Nifty cracked below the 7,900-mark by tanking 490.95 points, or 5.92 per cent, to 7,809 at close. The total investor wealth, measured in terms of cumulative market value of all listed stocks, plunged nearly R7 lakh crore, which crashed below the R100-lakh crore mark to end the day at R95,28,536 crore.
Steepest fall
Brokers put down the massive fall to the meltdown in global markets, with Asian bourses ending in deep red. Shanghai shares closed 8.49 per cent down while European markets were weaker by close to 3 per cent in early trade as the slowdown in China stoked concerns about the health of its economy and rattled investors.
Gold prices surge
Global crude oil too went below the $40 per barrel mark amid weak Chinese manufacturing growth and global oversupply. Extending its two-week winning streak, gold surged R150 to hit a three-month high of R27,575 per 10 grams in the national capital on seasonal buying by jewellers as investors fled the stock market.
Rupee dips
The rupee crashed below the crucial 66 mark by falling 90 paise to close at a two-year low of 66.73 against the dollar due to heavy demand for the US currency from importers and some banks. Foreign portfolio investors net sold shares worth Rs 2,340.60 crore on Friday, as per provisional data.
Blame the Chinese
Market expert Akash Jindal said that the main reason behind the Dalal Street bloodbath are global factors, specially the Chinese economy.
Jindal said, “The way Sensex has crashed and the rupee fell, it is a reflection of the Chinese economy. The data coming from the Chinese economy is quiet poor, and that has shown reflection in the world economy, including India.”
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