The Hindu Business Line : Sensex takes a 678-point knock on weak global cues

Mumbai, Nov 21 Weak global cues triggered a selling spree across Indian stocks on Wednesday, sending the BSE benchmark index crashing below the 19,000 mark.

The Sensex closed at 18,602.62, tumbling by 678 points from its previous close.

“Apart from the global cues there were specific issues such as high crude prices, and fresh fears of a slowdown in the US economy,” said Ms Shahina Mukadam, Head of Research at IDBI Capital Market Services Ltd.

Among the global markets, the Nikkei 225 fell 2.46 per cent, whereas the Hang Seng was down by 4.15 per cent.

“There was nervousness in the market which is a reflection of weak global sentiments. There was also a lot of profit booking on the part of FIIs,” said Ms Anita Gandhi, Head of Institutional Business, Arihant Capital Market Services Ltd.

Foreign institutional investors were net sellers to the tune of Rs 2,007.7 crore. Domestic institutions were, however, net buyers for Rs 630.06 crore.

The broader S&P CNX Nifty fell by 3.80 per cent, closing at 5,561.05. “Morgan Stanley has downgraded China and India which are now rated as neutral from the previous rating of over-weight, this also led to a lot of selling by the FIIs,” said Mr Sanjay Someshwar, sub-broker, Ventura Securities.

Power stocks weaken

Sectors such as BSE-Metal, BSE-PSU and BSE-Power took a heavy beating, declining by 6.11 per cent, 5.92 per cent and 5.91 per cent respectively.

The BSE-Bankex too fell 4.99 per cent, while BSE-Realty dropped 4.73 per cent.

The BSE-Midcap fell by 4.73 per cent, while BSE-Smallcap was down by 3.98 per cent.

“The Mid Cap and Small Cap stocks saw a surge of 40 per cent last week; today we saw those who were trying to cover their losses in the F&O segment booking profits by selling off their stocks in these segments”, said Mr Someshwar.

The major losers of the day included NTPC which dipped 8.03 per cent, BHEL (6.33 per cent), ITC (5.95 per cent), Maruti Suzuki (5.85 per cent), Reliance Energy (5.65 per cent), ICICI (5.5 per cent) and L&T (5.25 per cent).

The market breadth was negative as 77 per cent of the BSE stocks declined, while 22 per cent advanced.

There is the F&O expiry pressure also on investors, as the contracts will expire by next Thursday, said market men.