Poor quarterly earnings of Coal India and Cipla coupled with fear economic slowdown to continue pushed the benchmark Sensex further down. Sensex plunged by 255.14 points to a four-month closing low of 20,193.35. Nifty closed at its three-month low of 6,001.10 after it slid by 82.90 points. Rupee also slid by 32 paise and ended the session at Rs 62.42 per dollar.
Markets analysts said that the selling was seen across the market and despite retail inflation showing signs of easing investors continued to sell due to the fear of slowdown in economy would continue. Even buying from foreign institutional investors (FII) couldn’t limit the fall in markets or currency. The benchmark index opened higher but quickly fell back on weak Asian cues and heavy selling from retail investors and domestic institution. Index remained in the negative terrain throughout the session and finally settled lower by 1.25 per cent or 255.14 points its biggest fall since February 3. Sensex closed at its weakest levels since October 8, 2013 when index had closed at 19,983.61. Nifty also tumbled 82.90 points, or 1.36 per cent and closed at its lowest levels since its closing at 5,995.45 on November 22, 2013.
Worries over the domestic economy also led to selling after data showed that industrial output contracted 0.6 per cent in December. Retail inflation easing to 2-year low of 8.79 per cent in January also could not help improve the overall sentiment of the market. Meanwhile, rupee also depreciated by 32 paise, its biggest daily drop in over two weeks, and finally ended the session at Rs 62.42 per dollar. As per forex experts, currency came under pressure due to heavy dollar demand from oil marketing companies.
“In the last couple of sessions, we have witnessed that India’s trade data, IIP and CPI have all been encouraging. However, this set of data has failed to give support to the rupee. On the global front, dollar index is trading flat amid absence of major events or data releases,” said Abhishek Goenka, Founder & CEO, India Forex Advisors.