India’s benchmark index crashed 1,000 points on Thursday, wiping out as much as Rs 4 lakh crore of investor wealth in minutes, confirming the worst fears that terrible volatility is here to stay.
The Dalal Street woke up on Thursday with a sense of severe foreboding as Asian stocks had lost a whopping 5 percent in the morning trade, tracking a blood bath in the US equities overnight.
While NSE Nifty index tested the 10,000 levels, BSE Sensex plunged 1,029 points to 33,732 intraday.
In the US, the Dow Jones Industrial Average dropped more than 800 points. The S&P500 lost 3.29 percent and the Nasdaq Composite index dived 4.08 percent.
The heavy selling in the US and Asian markets roiled confidence in India, even as the further fall of Indian rupee to 74.48 against the US dollar triggered the frenzied bear activity.
Major Asian indexes were also in the red. China’s Shanghai Composite was down 4.74 percent, Japan’s Nikkei 225 was down 4.37 percent, Hong Kong’s Hang Seng dropped 3.95 percent and South Korea’s Kospi index was down 3.63 percent.
Among Indian equities, IT stocks marked the worst losses, tracking a similar rout the technology shares faced in the Wall Street. While banks, realty and metal stocks also lost, media and oil and gas equities fared comparatively better.
Scores of market heavy weights were sold off in the morning, including SBI, Tata Steel, Infosys, Airtel, Yes Bank, Maruti Suzuki, HDFC, ICICI Bank, Wipro, Tata Motors, Coal India, L&T, and the like.
Worsening capital flight
Indian stock market has been witnessing heavy volatility over the past several weeks owing to factors such as the rupee’s slide, rising oil prices, higher stock valuations, fears over corporate profitability and the worsening outlook on credit availability.
Earlier this week,