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BSE Sensex falls over 700 points on weak GDP, Nifty also down

By FnF Correspondent | PUBLISHED: 01, Sep 2015, 15:29 pm IST | UPDATED: 01, Sep 2015, 15:29 pm IST

BSE Sensex falls over 700 points on weak GDP, Nifty also down Mumbai: The benchmark BSE sensex plunged over 700 points on Tuesday on weak GDP. The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading 112.50 points or 1.41% down at 7,858.80 points.

Country's key macro-data with slower GDP growth of April-June quarter, subdued Asian cues amid weakness in China's economy, loomed over the trading sentiments.

The sensex of the S&P Bombay Stock Exchange (BSE), which opened at 26,127.04 points, was trading at 25,937 points (at 01.09 p.m.) in the afternoon session, down 346.09 points or 1.32 percent from the previous day's close at 26,283.09 points.

The sensex touched a high of 26,141.07 points and a low of 25,913.57 points in the trade so far.

The selloff in domestic stock markets is being linked to fresh bout of weakness across Asia and Europe, where equities took a big beating on Tuesday. Japan's Nikkei closed nearly 4 per cent lower.

European stock markets traded with over 2.5 per cent cuts, while Dow futures indicated a lower opening for the Wall Street.

Analysts say rising concerns of a deep-seated slowdown in China, the world's second biggest economy, is weighing on global stocks. Investors tend to react in panic every time a negative data comes out of China.

China's giant manufacturing sector in August contracted at the fastest pace in three years, rattling Asian markets on Tuesday. Even China's services sector, which has been one of the few bright spots in the sputtering economy, showed alarming signs of cooling.

Traders are also disappointed with a series of weak economic data in India. Growth in core sector, which contributes nearly 40 per cent to industrial output, slowed to a 3-month low, while June quarter GDP grew below estimates at 7 per cent, weighing on sentiments.

A delay in recovery in corporate earnings has led Macquarie, Barclays and Ambit to downgrade Indian shares over the last few days.

Domestic stock markets are also reeling from rising momentum of selling by foreign investors. In August, foreign investors sold shares worth Rs 16,877 crore, which is a record.

Banking stocks led the losses and underperformed the broader markets. The Bank Nifty slumped over 4 per cent on Tuesday on fears that HDFC Bank's aggressive rate cut will put pressure on margins of the banking system.

High beta metals and realty stocks also traded with nearly 3.5 per cent cuts; capital goods and auto stocks also fell sharply. Just three out of 50 stocks in Nifty traded higher.

Higher rupee was the only silver lining in Tuesday's trade today. As of 2.53 p.m., the rupee traded 66.37 per dollar, 11 paise higher than yesterday's close of 66.48.

Heavy selling pressure was seen in banking, metal, capital goods and realty sectors, while marginal good buying was observed in IT and technology, media and entertainment (TECK) sector.