The Sensex suffered its biggest intra-day loss in 64 trading days on Friday as the Bombay Stock Exchange’s benchmark index was buffeted by concerns over sovereign debt problems in Europe and a worrying job situation in the US. That added to a general fatigue in the market.
The Sensex plunged by 434 points, or 2.68 per cent, while the National Stock Exchange’s Nifty fell 127 points or 2.61 per cent to close at 4,718 points.
Most Asian markets slipped – Japan’s Nikkei 225 fell about 3 per cent, Hong Kong’s Hang Seng slid 3.33 per cent and South Korea’s Kospi dropped 3.05 per cent. London’s FTSE 100 saw a correction of over 1 per cent.
“The market fall was more influenced by global trend and news on few European countries scoring default. Due to this global markets went on a selling spree and was no exception,” said Dinesh Thakkar, Chairman and Managing Director of Angel Broking.
The global selling spree was triggered by ballooning deficits in euro zone countries Greece and Portugal that pulled the Sensex to 15,790 points after opening at 16,222 points. The last time Sensex closed below the 16,000-level was on Nov 4, 2009 at 15,912.13 points.
Friday saw the biggest loss since November 3, when the index had lost 553 points on a single day from a high of 15,957 to close at 15,404 points. Since the start of 2010, the Sensex has lost 1,768 points.
{{/usCountry}}Friday saw the biggest loss since November 3, when the index had lost 553 points on a single day from a high of 15,957 to close at 15,404 points. Since the start of 2010, the Sensex has lost 1,768 points.
{{/usCountry}}According to Ashu Madan, President, Equity Broking of Religare Securities Ltd, the market was fatigued after zooming from 9,000-level to 18,000-levels. “There were corrections happening but they were shallow. This kind of credible correction was expected, but you never know when it comes,” said Madan.
The market had factored in every positive aspect, be it election outcome or corporate results, market players said.
The sectors that led the recovery were also the most hit during the correction as they are the most traded. Sectors such as infrastructure, metals, real estate were among those who got hit in this correction. Realty and metal shares lost over 4 per cent while PSU, oil and gas and bankex lost over 3 per cent.
“We had been underperforming global markets. However, countries defaulting is a major issue. Indian markets will follow global cues for sometime, as there is uncertainty over global recovery, said Thakkar, adding, “It would take a few days before you can take a decision on visible future.”