Press Trust of India
Mumbai, Jan 7: Indian markets joined the global sell-off sparked by China growth concerns as the benchmark Sensex Thursday saw this year’s worst single-day fall of 555 points to end at a 19-month low of 24,851.83, pulling down the rupee to more than a three-week low of 66.93. On the other hand, gold regained the Rs 26,000-level to trade at a three-week high of Rs 26,330 per 10 grams.
In the forex market, the rupee weakened another 11 paisa to close at over three-week low of 66.93 against the dollar due to heavy demand for the US currency from banks and importers amid a sharp fall in equities. The index ended the day 2.18 per cent down at 24,851.83 as anxious investors sold off shares across all sectors, including realty, infrastructure, auto, metal, power and oil and gas.
Asian markets wallowed in deep red, with Shanghai shares crashing over 7 per cent, forcing authorities to suspend trading less than half an hour after opening as the new circuit-breaker tripped for the second time in a week. This followed China’s central bank devaluing its currency by 0.51 per cent to 6.5646 per cent against the dollar, the lowest since March 2011. The fall came amid worries over a slowing growth in the world’s second-largest economy, which has roiled investors worldwide, and pressure on its currency from capital outflows. Global crude oil too slumped to multi-year lows to slip below the $34 per barrel mark following China’s weakening currency and rising US energy reserve. Maintaining its winning streak for the fourth straight day, gold regained the Rs 26,000-mark per 10 grams for the first time since December 12 by surging Rs 430 to close at Rs 26,330 per 10 grams in the national capital.
Gold in the global market also rallied to a three-week high of $1,102.85 an ounce in Singapore after China’s devaluation of its currency and rising geo-political tension in West Asia added to its safe-haven appeal. The broader NSE Nifty cracked below the 7,600-level by slumping 2.23 per cent, or 172.70 points, to 7,568.30 at the close.
