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Markets ended today's session on an extremely weak note with benchmark indices falling nearly 3.6% each after the rupee depreciated closer to its all time low level of 68.80. The investor sentiment was also shaken on reports that the US might strike Bashar Al Asad led regime in Syria for using chemical weapons against the opposition.
The BSE benchmark index- Sensex provisionally closed lower lower by 680 points at 18,206 and the 50-share Nifty slumped 209 points to settle at 5,341.
The rupee slid a little closer on Tuesday to a record low struck against the dollar last week, as investors remained doubtful whether the government would act decisively to restore confidence in the economy.
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(Updated at 15.20 hours)
Markets are witnessing heavy selling pressure in the last hour of trade. Both the benchmark indices are trading weaker by 4%. The BSE benchmark index- Sensex has crashed 716 points to 18,169 and the 50-share Nifty has plunged 221 points to 5,329 on the back of sliding rupeee and fears that US might strike Syria.
The rupee weakened in afternoon trades and breached the Rs 68 mark as Foreign Institutional Investors (FIIs) resorted to selling in domestic markets and there is dollar demand from importers which is keeping the rupee under pressure.
At 2:40PM the rupee was quoting at Rs 68.02 compared with previous close of Rs 66.02, a weakening of Rs 2 per dollar. The rupee had opened at Rs 66.30 per dollar.
With crude oil prices rising due to fears about a potential US military strike on Syria, economists have called for an increase in subsidised fuel prices to help address concerns over a record high current account deficit and a fiscal deficit that is among the highest of all the major emerging market economies.
Most of the Sensex stocks are trading on a weak note. Hero MotoCorp is the top loser, down 5.4% at Rs 1,917. ICICI Bank, reliance Industries, HDFC, Hindalco, ITC, jindal Steel, Larsen & Toubro, Sun Pharma and Bharti Airtel are also trading weaker by 2.6-5% each.
On the sectoral front banking stocks are amongst the worst hit. The BSE banking index- bankex has fallen 5% or 512 points 9,880. Consumer durables, realty, oil & gas, capital goods FMCG and metal indices are also down 2.5-4% each.
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Updated at 1400 hrs
Markets are witnessing a heavy selling pressure as the Indian rupee has breached the crucial psychological level of 67.50.
The BSE benchmark index- Sensex has slumped 421 points or 2.5% to 18,463 levels and the 50-share Nifty has plunged 143 points or 2.5% to 5,407 levels.
Meanwhile, the Indian Rupee has depreciated further; the local unit is down 2.8% or Rs 1.68 at 67.68 to a dollar.
Rupee came under pressure on reports that Standard & Poor's considers chances of a credit ratings downgrade for India higher than for Indonesia, Bloomberg News reported, citing comments made by an analyst of the credit rating agency at a briefing in Seoul.
S&P analyst Kim Eng Tan also said there was more than a one-in-three chance for India rating cut within two years, according to Bloomberg.
S&P has a "BBB-minus" rating on India with a "negative" outlook. A downgrade would push Asia's third largest economy to "junk" status.
Investors are now anxiously waiting for any fresh measures with Raghuram Rajan taking over the reins of RBI as the new governor on September 5.
Global Markets
Meanwhile, upbeat economic data powered Asian markets to a fourth straight day of gains on Tuesday, while gold and the yen lost some of their safe-haven appeal as Washington delayed a possible strike on Syria.
European shares opened higher, helped by a second huge mobile telecoms deal in as many days as Microsoft announced a $7.2 billion bid for the phone business of once-dominant Finnish manufacturer Nokia.
After some choppy initial moves, Europe's FTSEurofirst 300 was up 0.2%, led by Britain's FTSE 100 and Germany's DAX and France's CAC 40 both lost 0.2%.
Earlier MSCI's broadest index of Asia-Pacific shares outside Japan added 0.76%, building on Monday's 1.2% rise and marking a fourth day of gains.
The Nikkei stock average was the region's standout performer. It surged 3% to a three-week high helped by the weaker yen, hopes of continued government stimulus and talk Japan could win the right to host the 2020 Olympic Games.
Sectors & Stocks
Selling pressure is visible across the board. Banking, oil & gas, consumer durables and FMCG stocks are amongst the worst hit.
The BSE banking index- Bankex is down 3.5% or 366 points at 10,031. Oil & gas index is down 2.5% at 8,144. Consumer durables, FMCG, realty, capital goods, power, healthcare and metal indices are also down 1-2.5% each.
Most of the Sensex stocks are trading in the red. Index heavyweight Reliance Industries is the top loser on the Sensex the stock has fallen 4.3% to Rs 845. Hero MotoCorp is also trading weaker by 4.6% at Rs 1,932.
HDFC, Hindalco, ICICI Bank, HDFC Bank, ITC, Sun Pharma, HUL, Tata Steel, Jindal Steel and Bharti Airtel are also trading weaker by 2-4% each. While, Sesa Goal, Coal India, Wipro, Tata Motors and mahindra & Mahindra are among the notable gainers.
The market breadth was negative. 1,250 stocks declined while 794 stocks advanced on the BSE.
