Sensex drops 186 pts on weak China data, US stimulus cut fears
The Sensex fell for the first time in five days to end about 186 points lower on Thursday on broad-based selling after global markets slipped amid downbeat Chinese manufacturing data and fears of more US stimulus cuts.business Updated: Feb 20, 2014 18:18 IST
The benchmark Sensex fell for the first time in five days to end about 186 points lower on Thursday on broad-based selling after global markets slipped amid downbeat Chinese manufacturing data and fears of more US stimulus cuts.
After gaining nearly 530 points in the past four sessions, the Sensex dropped 186.33 points, or 0.90%, to 20,536.64 as recent gainers in the banking, metal and oil & gas packs ended in the red.
Just six constituents like Dr Reddy's and Bajaj Auto of the 30-share Sensex managed to end up. ICICI Bank, Bharti Airtel and Tata Steel led the 24 laggards in the bluechip index, which had on Wednesday closed near one-month highs.
The 50-scrip NSE index Nifty dropped 61.30 points, or 1%, to end at 6,091.45. In the past four days, it had gained over 150 points.
Global stocks witnessed a volatile session after HSBC and Markit Economics said their index of Chinese manufacturing fell to 48.3 from January's final figure of 49.5. A number below 50 indicates contraction.
The Chinese data spooked investors who were nervous after minutes of the US Fed's January gathering released yesterday showed several policy makers were in favour of stimulus cuts.
"Global markets were showing selling pressure, post weaker manufacturing data in China and also because of US Federal Reserve indicating continuation of tapering of stimulus, This, along with profit booking after recent rally, led to selling pressure in India too," said Rakesh Goyal, senior vice-president, Bonanza Portfolio.
Sectoraly, the BSE banking sector index suffered the most by losing 1.63% as SBI plunged 1.80%, ICICI Bank by 2.15% and HDFC Bank by 0.99%.
The metal sector index dropped by 1.01% after Tata Steel lost 1.80%, Hindalco 1.52% and Sesa Sterlite by 0.48%. Overall, 10 of the 12 sectoral indices closed down. Capital goods and power barometers were the two which ended higher.