Press Trust of India
Mumbai, Sep 7: The China nightmare and lingering worries over monsoon tormented markets Monday when the benchmark BSE Sensex closed below the 25,000-mark for the first time in 15 months, losing 308 points in a day. At 24,893.81, this is the lowest closing in 15 months for the Sensex, which has lost almost all the gains since the relief rally from May 26, 2014, when Narendra Modi was sworn in as the Prime Minister. The Nifty too couldn’t take the selling pressure and cracked below the 7,600-mark, sinking to the lowest in 13 months.
Throughout the day, Shanghai stocks see-sawed in and out of volatility following an extended weekend break as China lowered its GDP growth to 7.3 per cent, from the previous 7.4 per cent. The world’s second-largest economy also saw its forex reserves in August record the largest monthly fall — $93.9 billion – at $3.55 trillion. The woes of rupee added to the market downfall, with the currency cooling against the dollar before settling at 66.82. The dismal show is aggravated by monsoon worries as there were reports that the Indian Meteorological Department now expects rains to be 82 per cent of the long-term average (LTA) as against its earlier forecast of 88 per cent. However, after trading hours, the department clarified that that there won’t be any revision in the LTA figure.
“Markets are increasingly getting concerned about the slowdown in the Chinese economy and we believe that the sell-off in the domestic markets will continue until China stabilises or clarity emerges on US interest rates,” said Vijay Singhania, Founder-Director, Trade Smart Online, a leading brokerage firm. Axis Bank led the fall show (3.90 per cent) while others such as Vedanta, ICICI Bank, Hindalco, Lupin and BHEL lost big time too. Sector-wise, BSE healthcare fell most by 2.57 per cent, followed by metal, banking, power and capital goods.
In broader markets, mid-cap index tumbled 2.19 per cent while small-cap ended 1.76 per cent lower. Shanghai stocks ended 2.52 per cent down and Hong Kong’s Hang Seng fell 1.23 per cent. But Japan’s Nikkei ended 0.38 per cent higher. European markets showed promise in the opening trade as they ruled firm. The impact of the sell-off was so heavy that 26 stocks in the Sensex pack turned red.
