Sensex, Nifty close over 2% lower on sharp sell-off - GulfToday

Sensex, Nifty close over 2% lower on sharp sell-off


A broker reacts while trading at his computer terminal at a stock brokerage firm in Mumbai, India. Reuters/ File

Weak growth numbers released over the weekend resulted in a bruising sell-off in the markets on Tuesday, erasing 770 points from Sensex. Growth-sensitive stocks, state-run banks and manufacturing companies contributed most to the fall.

The benchmark Sensex fell by 769.88 points or 2.06 per cent at 36,562.91 before falling as much as 36,466.01. The broader Nifty declined by 225.35 points or 2.04 per cent lower at 10,797.90.

Despite a series of measures announced by Finance Minister Nirmala Sitharaman to revive private investment and the transfer of the RBI’s excess reserve to the government, investor confidence remained subdued.

India ‘VIX’ or the volatility index − the market’s expectation of volatility over the near term − closed at 18.60, after it surged nearly 12 per cent.

“The sharp fall in the Q1 GDP growth to 5 per cent and the weak core sector growth are the key factors that have caused a fall in the markets as it opened after a long weekend,” said Joseph Thomas, Head of Research-Emkay Wealth Management.

Weak domestic consumption, especially rural consumption, has resulted mainly from low employment levels and non-availability of finance, which are issues that call for immediate measures to salvage the situation, he added.

Nifty PSU Bank index fell the most on Tuesday - by nearly 5 per cent. It was followed by heavy selling in metal stocks, with the index declining by over 3 per cent.

Indo-Asian News service

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