After suffering a severe setback, the key benchmark indices staged a recovery in afternoon trade after Republican Donald Trump won the United States presidential elections 2016. At 13:22 IST, the barometer index, the S&P BSE Sensex, was down 525.39 points or 1.9% at 27,065.75. The Nifty 50 index was down 172.05 points or 2.01% at 8,371.50. The Nifty was trading well above the psychologically important 8,000 mark after hitting an intraday low just a shade above that mark in morning trade. The Sensex regained the psychologically important 27,000 mark. It had earlier slipped below the 26,000 level at the onset of trading session. Key indices hit intraday high in afternoon trade.
The Sensex hit its lowest intraday level in more than five months. The Nifty hit its lowest intraday level in 4-1/2 months. The Sensex fell 1,688.69 points, or 6.12% at the day's low of 25,902.45 in early trade, its lowest level since 25 May 2016. The index fell 497.73 points, or 1.8% at the day's high of 27,093.41 in afternoon trade. The Nifty fell 541.30 points, or 6.34% at the day's low of 8,002.25 in early trade, its lowest level since 24 June 2016. The index fell 170.45 points, or 2% at the day's high of 8,373.10 in afternoon trade.
The initial sell-off on domestic bourses was triggered by the Union government's surprise move to withdraw currency notes with a denomination of Rs 1,000 and Rs 500, effective from Tuesday, 8 November 2016, midnight, in an attempt to crack down on black money.
Meanwhile, global financial markets also recovered after intraday sell-off after Republican Donald Trump pulled off a dramatic win to defeat Democratic contender Hillary Clinton in one of the most bitterly contested US Presidential battles. Donald Trump won 276 votes and Hillary Clinton won 218 votes. Candidates need at least 270 electoral votes to win. Trump will be the 45th President of the United States. The United States presidential elections of 2016 were held yesterday, 8 November 2016.
The broad market depicted weakness. There were more than 8 losers against every gainer on BSE. 2,334 shares fell and 274 shares rose. A total of 79 shares were unchanged. The BSE Mid-Cap index was currently down 3.32%. The BSE Small-Cap index was currently down 4.31%. The decline in both these indices was higher than the Sensex's decline in percentage terms.
In overseas stock markets, Asian stocks dropped in volatile trading. In US, stocks finished in positive territory for a second straight day on Tuesday, 8 November 2016, as gains in the consumer goods, utilities and telecoms sectors led shares higher.
Trading in US index futures indicated that the Dow Jones Industrial Average could slump 444 points at the opening bell today, 9 November 2016.
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Back home, auto stocks dropped. Tata Motors (down 1.92%), Maruti Suzuki India (down 4.71%), Mahindra & Mahindra (M&M) (down 2.78%), Eicher Motors (down 3.62%), Bajaj Auto (down 2.64%), Hero MotoCorp (down 4.59%) and TVS Motor Company (down 4.54%) and Ashok Leyland (down 4.03%) dropped.
Telecom stocks edged lower. Bharti Airtel (down 2.49%), Idea Cellular (down 1.71%), MTNL (down 7.16%), Tata Teleservices (Maharashtra) (down 6.58%) and Reliance Communications (down 7.96%) fell.
Shares of Bharti Infratel fell 0.32%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.
On the macro front, in a historical move that will add record strength in the fight against corruption, black money, money laundering, terrorism and financing of terrorists as well as counterfeit notes, the Government of India decided that the five hundred and one thousand rupee notes will no longer be legal tender from midnight of 8 November 2016. The Government accepted the recommendations of the Reserve Bank of India (RBI) to issue two thousand rupee notes and new notes of five hundred rupees will also be placed in circulation. Notes of one hundred, fifty, twenty, ten, five, two and one rupee will remain legal tender and will remain unaffected by the decision. The Prime Minister said the steps taken by the Government would strengthen the hands of the common citizens in the fight against corruption, black money and counterfeit notes. Persons holding old notes of five hundred or one thousand rupees can deposit these notes in bank or post offices from 10 November 2016 onwards till 30 December 2016, the Prime Minister announced yesterday, 8 November 2016, evening.
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