The global sell-off in equities and currencies on Thursday pulled the benchmark BSE Sensex down to 27,607.82, thereby crashing 324 points at the close. European shares were ruling markedly lower over concerns about gloomy outlook of global economies.
The rupee also reacted as the market was on crash course and fell to almost a two-year low of 65.50. Emerging market currencies fared no better as Turkish lira and South African Rand went downhill.
Minutes of US Fed’s July meeting suggested that the officials were in broad agreement that the economy is nearing a point which calls for a rate ‘lift-off’, which added to the anxiety level.
Commodities took a blow as Brent fell 1.59 per cent to $46.41 in the global market. Metal prices too came under pressure and melt. Positive comments from RBI Governor Raghuram Rajan that Indian economy is showing signs of a pick-up failed to lift mood.
The 30-share index resumed higher, but slid thereafter on intense selling, settling at 27,607.82, down 323.82 points, or 1.16 per cent. As many as 26 in the Sensex pack ended with losses. The NSE Nifty slumped below the 8,400-level, tumbling 122.40 points, or 1.44 per cent, to close at 8,372.75.
This is Nifty’s biggest single-day percentage fall since July 27. Intra-day, it hovered between 8,501.35 and 8,359. “Sharp sell-off was witnessed across the globe after the release of FOMC minutes, which suggest that Fed can hike rate in September. Continuous fall in commodity prices, rupee weakness, sell-off by foreign portfolio investors and profit booking dampened sentiment of investors,” said Gaurav Jain, Director, Hem Securities.