Sensex hits 4-month low, plunges 291 pts amid continued rupee woes
A fresh record low for rupee today rattled stock markets once again with benchmark BSE Sensex tumbling by 291 points to end at over 4-month low of 18,307.52.business Updated: Aug 19, 2013 16:45 IST
A fresh record low for rupee on Monday rattled stock markets once again with benchmark BSE Sensex tumbling by 291 points to end at over 4-month low of 18,307.52 as heavy FII selling in shares of banks, auto, pharma and FMCG eroded a staggering Rs 1 lakh crore in investor wealth.
The rupee touched all-time low of 62.81 against the dollar despite a number of steps from RBI to curb the currency free-fall. Also, weakness in global markets and speculation over the US rolling back its economic stimulus package as early as next month worsened the sentiment.
After Friday's 769-point crash - the worst fall in 4 years - the 30-share index on Monday opened flat at 18,587.38. Increasing selling pressure brought Sensex down to intra-day low of 18139.15, down over 459 points.
A marginal recovery lifted the Sensex but it still closed 290.66 points, or 1.56%, down at 18,307.52. This is its worst closing since 18,242.56 on April 12.
"No respite has been seen today despite assurance from the government that situation of 1991 shall not be repeated and condition is not worse. Banking and auto stocks led the fall today," said Nidhi Saraswat, senior research analyst, Bonanza Portfolio Ltd.
Analysts said there was no heavy bottom-fishing in the markets even though stocks have become relatively cheaper in valuations over the last few sessions.
Similarly, NSE benchmark Nifty closed at 5,414.75, down 93.10 points or 1.69%. Also, SX40 index, the flagship index of MCX-SX, closed down 201.76 points, or 1.82%, at 10,881.76.
ICICI Bank and SBI shares led losses in banks on concerns over mark-to-market losses on banks' portfolios, brokers said.
Bucking the weak trend, software exporting companies led by Infosys rose over one% on hopes the fall in rupee would improve their revenues. IT companies get over 60% of their revenues from global markets.
To curb dollar outflows, RBI on August 14 announced stern measures, including curbs on Indian firms investing abroad and on outward remittances by resident Indians.