Sensex drops 500 points in 2 days; closes at 18509
In the money market, the rupee has also touch fresh one month low in sync with the global dollar strength that has weakened all Asian currencies.
It was carnage on Dalal Street with the BSE Sensex shedding over 500 points in two trading sessions on Wednesday and Thursday. Political uncertainty, ETF funds and FII selling and ever-worsening economic data were the key triggers for the downfall. The Sensex closed at 18509, down 292 points or 1.55 percent and the Nifty ended at 5574, down 98 points or 1.73 percent. The benchmark indices closed below their 200-Day Moving Averages (DMA) for first time since August 2012, which is a bearish sign.
A fall below this average indicates breach of support and market participants consider closing their long positions inferring the long term trend has turned bearish. 33 stocks in the Nifty were trading well below its 200 DMA. Foreign funds sold shares worth 3.68 billion rupees on Wednesday, provisional exchange data showed. FIIs continued to be big buyers of Indian stocks in 2013, having bought over $10 billion. A sharp sell-off by FIIs could drag market to lower levels.
Realty stocks were the biggest losers of the day. BSE realty index ended the day with losses of 3.24 percent. DLF loses 4 percent, Sobha Developers down 5.5 percent, HDIL down 5.3 percent. IT stocks took a u-turn in trade on Thursday. After gaining 24 percent in the March quarter, the index was down 2.45 percent. Jaiprakash Associates, UltraTechCement, HCL Tech, Jindal Steel and Reliance Infra were top losers on the Nifty.
Coal India, Dr Reddys Labs, HUL, Maruti Suzuki, M&M, Tata Motors and NMDC ended in green. 43 stocks out of Nifty 50 closed in red. India Inc on Thursday was impressed by Congress leader Rahul Gandhi's maiden interaction with corporate leaders saying he came across as a sincere leader and this can form the basis for future engagement with the industry.