Thaindian News

Mumbai, Oct 27 (IANS) A benchmark index of the Indian equities markets nosedived Tuesday to end about 2.3 percent lower than its previous close with traders hitting the sell button amid indications from the central bank that it would start tightening its monetary policy.
The sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened at 16,699.09 points, shut shop at 16,353.4 points — 387.1 points or 2.31 percent lower than Monday’s close at 16,740.5 points.

The S&P CNX Nifty of the National Stock Exchange (NSE), too, followed a similar trajectory and ended in the negative at 4,846.7 points, down 2.5 percent or 124.2 points.

Selling pressure was rampant across markets, with the BSE midcap index ending 3.69 percent lower and the BSE smallcap index 4.42 percent down.

Among the sectors that bore the bulk of the selling brunt were realty, metal and banking.

Market breadth was negative with only 442 stocks advancing, as many as 2,281 declining and 67 remaining unchanged.

The market sentiments were hit after the Reserve Bank of India (RBI) hiked the statutory liquidity ratio for commercial banks by 100 basis points while keeping key policy rates intact.

The move will suck away some liquid cash from the financial system.

Also, by ending the repurchase facility for non-banking finance companies, mutual funds and housing finance companies, the central bank has taken away one of the windows for easier credit to such institutions.

Among the losers on the Sensex were Hindalco, down 7.92 percent at Rs.126.15; Tata Steel, down 7.26 percent; Bharti Airtel, down 7.08 percent at Rs.306.60, and Reliance Communications, down 6.61 percent at Rs.208.25.

Among the gainers were Wipro, up 2.18 percent at Rs.604.15; Tata Motors, up 1.56 percent at Rs.547.75; Hindustan Unilever, up 0.86 percent at Rs.280.20, and Grasim Industries, up 0.78 percent.

Other major Asian markets were hit by the consolidation sentiment as well.

The Nikkei, a key index of the Tokyo Stock Exchange, closed 1.45 percent down at 10,212.46 points.

The primary index of the Hong Kong Stock Exchange, Hang Seng, shut shop 1.86 percent lower at 22,169.59 points.

At the Shanghai Stock Exchange, the composite index ended 2.83 percent down at 3,021.46 points.

European markets, however, were holding on to the green with the FTSE 100 index in Britain ruling 0.54 points higher at 5,219.96 points and its French peer, the CAC 40, was up 0.57 percent at 3,765.88 points.

Germany’s DAX was ruling at 5,662.91 points, up 0.37 percent.