Day after Bihar verdict, the BSE benchmark index Sensex, which crashed in early trade by plunging by 600 points in a knee-jerk reaction to the BJP’s Bihar loss, pared the losses and finally settled 144 points down at 26,121, following the Government’s remarks on reforms and Fitch’s soothing economic outlook on Monday.
Meanwhile, the rupee on Monday tumbled by 68 paise to close at a nearly 8-week low of 66.44 against the American currency on persistent dollar demand from banks and importers amidst sharp fall in equities. It resumed lower at 66.41 as against the last weekend’s level of 65.76 at the interbank foreign exchange market and dropped further to 66.50 before finishing at 66.44 per dollar, showing a loss of 68 paise or 1.03 per cent.
However, the domestic market witnessed major sell-off following the BJP-led NDA’s poor show in Bihar assembly polls, but revival of buying after Fitch said the verdict is unlikely to have any major implications on the economic front helped recovery.
Falling for a fourth day, the 30-share index after dipping below the crucial 26,000-level in opening trade to touch a low of 25,656.90 staged a comeback and closed 143.84 points or 0.55 per cent down at 26,121.40. The gauge had lost 469.19 points in four trading sessions.
In a bid to soothe the market, Finance Minister Jaitley said that ‘structural reforms will continue. Positive statements on election result from financial services majors including Citigroup, Nomura and Bank of America Merrill lynch also helped dissipate some fears.
Shares of Sun Pharma emerged as the top loser among Sensex constituents by tumbling 5.82 per cent after the firm reported a 46 per cent dip in consolidated net profit.
On the domestic currency front, it had last ended at 66.46 on September 16. The rupee has lost 95 paise or 1.44 per cent in three trading days recently and it hovered in the range of 66.50 to 66.31 during the day. The dollar index was trading lower by 0.26 per cent against a basket of six currencies in the late afternoon trade. At overseas market, Oil prices rebounded in Asia but stayed below $45 a barrel as gains were limited by a strong dollar and data showing a decline in Chinese crude imports.
The Nifty NSE, which also slipped below the 7,800-level at the outset and hit a low of 7,771.70, bounced back at a rapid pace to touch session’s high of 7,937.75 and concluded 39.10 points, or 0.49 per cent down at 7,915.20.
“Market was volatile with a negative bias as the Bihar election results influenced the sentiments of investors,” said Vinod Nair, Head-Fundamental Research at Geojit BNP Paribas.
In overseas market, Asian stocks ended mixed after robust US jobs data bolstered expectations of a US Federal Reserve rate hike at its next momentary policy review in December.
Key indices in China and Japan rose between 1.58 to 1.96 per cent, while indices in Hong Kong, Singapore, South Korea and Taiwan moved down by 0.42 to 0.75 per cent. European markets were trading narrowly mixed as indices in France and Germany eased by 0.16 to 0.31 per cent while the UK’s FTSE was higher by 0.28 per cent.