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Broad-based sell-off on prospects of political turmoil depresses equities
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SME Times News Bureau | 16 Mar, 2018
Prospects of political instability led to broad-based selling in the
Indian equity markets on Friday, even as weak global cues continued to
mar investors' sentiments.
According to market observers, the
ongoing IPO (initial public offering) season, along with the nearing of
financial year-end and outflow of foreign funds, were among other
factors that contributed to the downfall of the equity indices.
On the National Stock Exchange (NSE), the wider Nifty50 declined by 165 points or 1.59 per cent to close at 10,195.15 points.
The
barometer 30-scrip Sensitive Index (Sensex) of the BSE closed at 33,176
points -- down 509.54 points or 1.51 per cent from the previous
session's close -- scaling a low of 33,119.92 points during the
intra-day trade.
The BSE market breadth was bearish with 1,835 declines and 859 advances.
In
terms of the broader markets, the S&P BSE mid-cap index edged lower
by 1.07 per cent and the small-cap index by one per cent.
"Stocks
suffered steep losses on the last trading day of the week in a
broad-based sell-off. Trading sentiment took a hit after Telugu Desam
Party (TDP) reportedly decided to quit the ruling Narendra Modi led
National Democratic Alliance (NDA) government," Gaurav Jain, Director at
Hem Securities, told IANS.
"Negative clues from global markets
also affected the sentiments. Most Asian stocks fell as reports of more
chaos in the Trump administration tested investors' nerves, already
frayed by fears that US tariffs could hurt the global economy and
trigger a trade war," he added.
Apart from the political
concerns, fiscal year-end considerations, selling before the onset of
the Long Terms Capital Gains regime from April 1 and a bunch of lined up
IPOs also resulted in liquidity being sucked out of the market, said
Deepak Jasani, Head - Retail Research, HDFC Securities.
"Broad
market indices like the BSE mid-cap and small-cap indices lost less,
thereby outperforming the main indices. Sectorally, there were no
gainers," Desai told IANS.
All the 19 sub-indices of the BSE
closed in the red, with the S&P BSE auto index slipping by 409.77
points, followed by metal index by 327.44 points, oil and gas index by
320.65 points, banking index by 312.62 points and capital goods index by
309.63 points.
On the currency front, the Indian rupee closed flat at 64.94 against the US dollar from its previous close.
"Yen
appreciation also caused weak global markets. On the domestic front,
FIIs (foreign institutional investors) have been net sellers in equity
markets since last few trading sessions," said Anita Gandhi, Whole Time
Director at Arihant Capital Markets.
In terms of investments,
provisional data with the exchanges showed that FIIs sold scrips worth
Rs 150.46 crore and domestic institutional investors worth Rs 150.46
crore.
"Series of fresh IPOs are also sucking some amount of
liquidity from the markets leading to investors as well as institutions
taking some profits. Nearing of financial year end and advance tax
payments may also have caused some profit taking," Gandhi told IANS.
Major
Sensex gainers on Friday were: Mahindra and Mahindra, up 0.88 per cent
at Rs 741.55; Wipro, up 0.85 per cent at Rs 295.75; Hindustan Unilever,
up 0.51 per cent at Rs 1,304; and Yes Bank, up 0.16 per cent at Rs
312.90.
The Sensex losers were: Tata Motors, down 3.67 per cent
at Rs 340.10; Tata Motors (DVR), down 3.21 per cent at Rs 190; Asian
Paints, down 3.09 per cent at Rs 1,125.05; Adani Ports, down 2.89 per
cent at Rs 371.05; and Hero MotoCorp, down 2.67 per cent at Rs 3,546.05.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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