Sensex plunges again on global flu, rupee punch
The Sensex caught the global flu again on Wednesday, as a financial crisis in Portugal, a political crisis in Egypt and worries over China's growth dampened market sentiments, which were compounded by a weak rupee that fell beyond 60 to the US dollar again.business Updated: Jul 04, 2013 03:22 IST
The Sensex caught the global flu again on Wednesday, as a financial crisis in Portugal, a political crisis in Egypt and worries over China's growth dampened market sentiments, which were compounded by a weak rupee that fell beyond 60 to the US dollar again.
The benchmark 30-share index plunged 286 points or 1.47% to close at 19,177.76 and analysts expected the rupee and global oil prices to be driving factors determining India's market. The NSE's 50-share Nifty lose 1.48% or 86 points to close at 5770.90.
Bank stocks slumped on RBI proposing increased capital requirements for banks' exposure to corporates having unhedged foreign exchange exposure. SBI shares were down 4.58% to close at R1,899.60.
"Apart from global cues, the rupee has also lost ground against dollar and breached 60 mark again; pounding pressure," says Jayant Manglik, president, retail distribution, at Religare Securities.
Foreign institutional investors (FIIs) were net sellers of shares worth R705 crore.
Market analysts are expecting stocks to stay range-bound as uncertainties rock global markets.
"We expect the Nifty to consolidate in the broader range of 5650-5950 levels and an either side break would determine the next directional move," Manglik said.
"In near term the markets look pretty range bound, and I doubt that earnings (for the April-June quarter expected this month) would be a major trigger for the market," said Ravi Shenoy, vice-president at Motilal Oswarl Securities.
Amid the turmoil, experts advise investors to steadily build up a portfolio of strong stocks with the long term in mind.
"This is a nice time to build up your portfolio. Move out of stocks where there is no visibility in earnings, to stocks which have this visibility," Shenoy said. "Shift from passive to active portfolio management," Manglik said, adding that IT stocks may be worth investing in.