Mumbai, India (BBN)-The Nifty and the Sensex plunged nearly one per cent as participants indulged in liquidating positions in view of November month derivatives expiry.
Besides, weak Asian cues as upbeat economic data strengthened the prospects of higher US interest rates and the continued free-fall of the rupee against the American currency weighed on the sentiment.
At 1:15pm, the 30-share BSE index Sensex was down 231.20 points or 0.89 per cent at 25,820.61 and the 50-share NSE index Nifty was down 72.10 points or 0.9 per cent at 7,961.20.
Among BSE sectoral indices, auto index fell the most by 1.56 per cent, banking 1.28 per cent, oil & gas 1.23 per cent and realty 1.15 per cent. On the other hand, IT index was up 1.15 per cent, TECk 0.66 per cent and metal 0.02 per cent.
Top five Sensex gainers wereTCS (+1.28%), Infosys (+1.24%), Bajaj Auto (+1.07%), Wipro (+0.95%) and Power Grid (+0.52%), while the major losers were Tata Motors (-4.13%), NTPC (-2.53%), ICICI Bank (-2.13%), Axis Bank (-1.78%) and Sun Pharma (-1.77%).
The rupee fell to as low as 68.8375 per dollar, almost surpassing its record low of 68.85 hit in August 2013, as the greenback remained strong over the prospect of higher US interest rates. The local currency, however, rebounded sharply after heavy intervention by the central bank.
The fall in the rupee comes at a time when investors are souring on the government’s shock move to remove high-value notes from circulation, which came on the eve of the unexpected election of Donald Trump as US President.
The NSE index has slumped 6 per cent since the demonetisation announcement on November 8, compared with a fall of 2.8 per cent in the MSCI Asia-Pacific index, excluding Japan .
“The gloom in the market due to the lack of (cash) liquidity is unlikely to ease until February next year,” said Saurabh Jain, assistant vice-president of research at SMC Global Securities.
A report by SMC Global said: “US stocks closed mixed on Wednesday as investors digested a number of economic data, including minutes from the US Federal Reserve’s November meeting. Fed minutes indicate rate hike “relatively soon” and stockpiles of crude oil in the US declined last week, according to new government statistics released Wednesday. New home sales in the US fell by much more than anticipated in the month of October.”
Among other Asian markets, Hong Kong’s Hang Seng shed 0.37 per cent, while Shanghai Composite Index shed 0.11 per cent in early trade. Japan’s Nikkei, however, was up 1.08 per cent.
The US Dow Jones Industrial Average had ended 0.31 per cent higher yesterday.