Sensex slumps over 800 pts, Nifty breaches 7000

Top Stories

»	49% Indian startups now from tier 2, 3 cities: Jitendra Singh
»	'India ranks 3rd in global startup ecosystem & number of unicorns'
»	Tripura exported over 9K tonnes of pineapples in 2 years
»	CPI inflation eases to 6.71% in July, IIP falls to 12.3%
»	Rupee depreciates 12 paise to close at 79.64 against US dollar

SME Times News Bureau | 11 Feb, 2016
Less-than-expected earning results, combined with negative European indices and a weak rupee dragged the Bombay Stock Exchange benchmark index Sensex down over 800 points on Thursday.

Bearish sentiments led the barometer index of the to recede by 807.07 points or 3.4 percent.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) traded deep in the red. It was down by 239.35 points or 3.32 percent percent at 6,976.35 points.

This is the fourth consecutive session of decline for both the indices amid weakness in the European equity indices.

Selling frenzy by foreign investors led both the bellwether indices of the Indian equity markets to touch their new 21-month intra-day lows. The bellwether indices even touched new 52-week lows during the intra-day trade.

The Indian VIX (volatility index) breached the 26,000-level, portending to sustained volatile trading sessions.

Initially, both indices opened on a weak note, following Wednesday's decline in the US markets and a steep fall in the Japanese index.

The selling pressure was accelerated by absence of any fresh positive trigger and below expected third quarter (Q3) results by the likes of banking major -- State Bank of India (SBI).

The decline of crude oil prices below $30 a barrel (one barrel is equal to 159 litres) kept sentiments subdued.

Investors' doubts over the central government's ability to perk up investments dragged the markets lower.

In addition, a weak rupee unnerved investors. It opened lower at 67.95 to a US dollar from its previous close of 67.84 to a greenback.

The weakness in rupee indicates massive flight of foreign funds from the equity markets. The foreign institutional investors (FIIs) were net sellers on Wednesday, they divested Rs.606.83 crore.

Investors' confidence was further eroded by hawkish comments made by US Fed chairman Janet Yellen to the US House Financial Services Committee on late Wednesday.

During her semi-annual monetary policy testimony to the committee, Yellen said that the US is unlikely to go in for a stimulus and that the rate hike cycle will continue.

"Negative European markets, coupled with disappointing results and a weak rupee supported the panic selling. The slump in crude oil prices and Yellen's remarks yesterday added pressure on the markets,"said Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services.

Vaibhav Agarwal, vice president and research head at Angel Broking, elaborated that selling pressure showed no signs of receding with markets continuing to witness across the board selling with an advance decline ratio of 1:4.

"Global headwinds and tepid growth in earnings continue to worry markets. However, we do expect some value buying to emerge at lower levels and arrest the slide," explained Agarwal.

Nitasha Shankar, vice president for research with YES Securities, cited that broader markets underperformed headline indices, as selling was seen across the board.