A benchmark index of Indian equities markets Wednesday closed 77 points or nearly half a percent down following a record depreciation of the rupee.
The Indian rupee hit another record low and slipped below the psychological resistance level of 60 against a dollar, due to high month-end demand for the US currency by importers and sustained outflow of capital.
The partially convertible rupee slumped to 60.63 against a dollar at the inter-bank foreign exchange market in Mumbai in the late afternoon session, surpassing its previous record low of 59.98 hit on June 20.
The 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE), which opened at 18,662.37 points, closed at 18,552.12 points, down 77.03 points or 0.41 percent from its previous day's close at 18,629.15 points.
The Sensex touched a high of 18,690.50 points and a low of 18,514.35 points in pre-noon trade.
The wider 50-scrip Nifty of the National Stock Exchange (NSE) also closed in negative territory. It closed down 0.36 percent or 20.40 points at 5,588.70 points.
The losses have been attributed to foreign institutional investors' continued selling after there was a record depreciation in the rupee value coupled with the US Federal Reserve signalling an end to its bond-buying programme.
"FIIs have pulled out big money and it will be good if they bring back money after FDI cap is raised. In any case, Nifty has fallen 11 percent in June hence reversal is on cards whether FDI is raised or not," said Kishor P. Ostwal, chairman and managing director, CNI Research.
There was heavy selling pressure on metal, bank, healthcare, automobile and consumer durables stocks. However, scrips of information technology (IT), fast moving consumer goods (FMCG) and power gained.
The S&P BSE metal index decreased by 188.87 points, bank index was down by 133.71 points, automobile index was down 97.92 points, healthcare index was lower by 95.44 points and the consumer durables index closed 95.44 points lower.
The IT index dipped by 99.84 points, FMCG index slipped by 42.31 points and the power index gained by 14.39 points.
Only 12 of the 30-sensitive companies gained in the day's trade. These included: Hero MotoCorp, up 3.89 percent at Rs.1,645; Tata Consultancy Services (TCS), up 2.84 percent at Rs.1,433.65; Gail India, up 2.73 percent at Rs.294.90; NTPC, up 2.13 percent at Rs.141.20; and Wipro, up 0.97 percent at Rs.347.55.
The main losers were: Bharti Airtel, down 5.74 percent at Rs.278.45; Mahindra and Mahindra, down 4.63 percent at Rs.912.15; Tata Motors, down 3.02 percent at Rs.273.20; Jindal Steel, down 2.89 percent at Rs.201.70; and Hindalco Inds, down 2.32 percent at Rs.94.55.
Among other Asian markets, the Japanese Nikkei was down by 1.04 percent, while the Chinese Hang Seng gained 2.43 percent. The Shanghai Composite Index fell 0.41 percent.
The European markets were trading mixed. While London's FTSE 100 was trading 0.96 percent down, Germany's DAX was higher by 1.49 percent and France's CAC 40 was 1.78 percent up.
