Key benchmark indices traded with steep losses in afternoon trade as a rout in Chinese stocks triggered a sharp slide in Asian markets and US index futures. At 13:18 IST, the barometer index, the S&P BSE Sensex, was down 473.54 points or 1.86% at 24,932.79. The decline for the 50-unit Nifty 50 index was higher in percentage terms than the Sensex's slide. The Nifty was currently down 152.85 points or 1.97% at 7,588.15. The Sensex continued to hover below the psychological 25,000 level after falling below that mark earlier during the trading session.
The broad market depicted weakness. There were more than three losers against every gainer on BSE. 2,145 shares declined and 553 shares rose. A total of 83 shares were unchanged. The BSE Mid-Cap index was currently off 2.06%. The BSE Small-Cap index was currently off 2.56%. The decline in both these indices was higher than Sensex's decline in percentage terms. All the nineteen sectoral indices on BSE were in the red.
A setback in global stocks triggered the latest slide on the domestic bourses. Trading in mainland China was suspended for the rest of the day after the CSI 300 index tumbled more than 7% in early trade, triggering the market's circuit breaker for a second time this week. China's central bank again surprised markets by setting onshore yuan's value lower to the US dollar, deepening concerns about the economy and sending the domestic stock markets tumbling. The People's Bank of China continued to fix the onshore yuan's value lower to the US dollar, at 6.5646, down 0.51% from the previous day's closing level, the biggest move since 13 August 2015, after the yuan's devaluation.
US stock futures pointed to sharp losses for US stocks at the opening bell. Trading in US index futures indicated that the Dow Jones Industrial Average could slide 266 points at the opening bell. US stocks closed sharply lower yesterday, 6 January 2015, pressured by continued concerns about global economic growth, declining oil prices and increased geopolitical tensions.
Axis Bank declined 3.41% to Rs 416.10 after reports that the government is mulling to sell a part of its stake in the private sector bank. The government is considering the sale to meet its asset sales target, report added. The Government of India (GoI) through the Specified Undertaking of the Unit Trust of India (SUUTI) holds 11.56% stake in Axis Bank as per the shareholding pattern as on 30 September 2015.
Realty stocks were sharply lower. Indiabulls Real Estate (down 5.98%), Unitech (down 5.27%), Oberoi Realty (down 4.12%), D B Realty (down 4.08%), DLF (down 3.84%), Sobha (down 1.62%), and Godrej Properties (down 3.09%) dropped.
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NBCC declined 0.61%. The company announced after market hours yesterday, 6 January 2016, that it has secured contracts worth about Rs 8523 crore in December 2015. Of the total business, the company said works worth Rs 8195 crore were related to project management consultancy (PMC) and projects worth Rs 328 crore were related to the engineering, procurement and construction (EPC) business. In a separate announcement after market hours yesterday, 6 January 2016, NBCC said it has secured a contract worth Rs 294.78 crore from IIT Mandi for construction of academic building, guest house, gymnasium, hospital and auditorium in the IIT Mandi campus.
Capital goods stocks dropped. BEML (down 3.08%), Bharat Heavy Electricals (Bhel) (down 5.86%), Havells India (down 3.24%), Thermax (down 1.55%), Crompton Greaves (down 4.75%) and Siemens (down 4.64%) declined.
L&T fell 3.05% at Rs 1,201.80 on concerns that the slowdown in the Middle East due to the crash in crude oil prices could affect the company's revenues. The stock hit a low of Rs 1,200.05, which is also a 52-week low for the stock. According to reports, the Middle East region contributes about 25-30% to the L&T's international order book. The consolidated order book for the L&T group rose 14% to Rs 244097 crore as at 30 September 2015 compared with order book as on 30 September 2014. International order book constituted 28% of the consolidated order book.
Meanwhile, parliamentary affairs minister Venkaiah Naidu was quoted as saying that the government has agreed to accept the conditions laid down by the Congress party to back the proposed goods and services tax bill (GST).
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