Fiscal deficit data unnerves markets, Sensex crashes 453 pts

Participants also kept their portfolios at a low ebb ahead of the second quarter GDP numbers.
Sensex Falls

Stocks went into a tailspin today, with benchmark Sensex suffering its biggest single-day fall in one year, after growing fiscal deficit concerns triggered a flight to safety among investors.

The BSE Sensex plummeted over 453 points to close at 33,149.35, while the broader Nifty finished below the key 10,300-mark.

Investors’ wealth as measured by market capitalisation of BSE listed companies declined by over Rs 1.06 lakh crore.

India’s fiscal deficit at the end of October hit 96.1 per cent of the budget estimate for 2017-18, mainly due to lower revenue realisation and rise in expenditure, official data showed.

Participants also kept their portfolios at a low ebb ahead of the second quarter GDP numbers.

Squaring-up of positions following end of November series contracts in the derivatives segment and a weak trend at other Asian markets also weighed on sentiment, brokers said.

The Sensex, after a gap down opening at 33,542.50, continued its slide to touch a low of 33,108.72. It finally settled 453.41 points or 1.35 per cent lower at 33,149.35.

This was its biggest single session fall since November 15 last year, when it had lost 514.19 points.

The broader NSE Nifty, after cracking below the key 10,300-mark, touched a low of 10,211.25, before finally ending 134.75 points, or 1.30 per cent, down at 10,226.55.

This was its biggest single day fall since September 27 this year, when it had declined by 135.75 points.

“Market slid and rupee depreciated as widened fiscal deficit concerns and expectation of extension in oil production cut from OPEC influenced investors to offload funds from the market.

“Today’s F&O expiry led volatility and selling in other Asian market hurt the sentiment, banks underperformed and metal lost the sheen,” said Vinod Nair, Head of Research, Geojit Financial Services.

The rupee slipped 31 paise to 64.62 (intra-day) against the dollar at the forex market.

Kotak Bank emerged as the worst performer among Sensex constituents by plunging 2.63 per cent, followed by SBI Bank (2.54 per cent).

Other laggards included Reliance Industries, Axis Bank, Wipro, Tata Steel, Lupin, M&M, HDFC, Sun Pharma, Cipla, Power Grid, ITC, Adani Ports, TCS, ONGC, Infosys and Maruti Suzuki.

Dr Reddy’s and NTPC were the only gainers, rising up to 0.45 per cent.

The broader markets were mixed, with the mid-cap index falling 0.55 per cent while small-cap rose 0.10 per cent.

Sector-wise, BSE bank declined 1.88 per cent, followed by energy (1.58 per cent), metal (1.10 per cent), PSU (1.09 per cent), auto (0.98 per cent), IT (0.87 per cent), power (0.83 per cent), oil & gas (0.81 per cent) and teck (0.70 per cent).

Realty and consumer durables managed to close in the green.

Overseas, most Asian indices ended lower. Hong Kong’s Hang Seng fell 1.51 per cent, Shanghai Composite Index shed 0.62 per cent, while Singapore fell 0.16 per cent. However, Japan’s Nikkei rose 0.57 per cent.

European shares moved lower in their late morning deals.

Frankfurt’s DAX rose 0.66 per cent and Paris CAC 40 gained 0.37 per cent. London’s FTSE, however, shed 0.17 per cent.

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