Sensex declines by 561 points on surging oil, West Asia flare-up
Stock market benchmark indices Sensex and Nifty tumbled on Tuesday as a sharp surge in crude oil prices due to the renewed flare-up in West Asia dented investors’ sentiment.
After three days of gains, the 30-share BSE Sensex dropped 561.46 points, or 0.72 per cent, to settle at 77,054.94. During the day, it tumbled 614.92 points, or 0.79 per cent, to 77,001.48.
The 50-share NSE Nifty dropped 158.95 points, or 0.66 per cent, to end at 24,052.05.
Fresh foreign fund outflows and the rupee falling below 96 mark against the US dollar also hit the sentiment, analysts said.
From the Sensex pack, HCL Tech declined the most by 4.42 per cent. Bajaj Finserv, InterGlobe Aviation, State Bank of India, Mahindra & Mahindra, and Larsen & Toubro were also among the major laggards.
Bharti Airtel, Tata Consultancy Services, Sun Pharma, Tata Steel, Adani Ports and Eternal were the winners. Brent crude, the global oil benchmark, surged 4.26 per cent to $86.85 per barrel.
Hit by surging crude oil prices and forex outflows, the rupee fell below the 96 mark on Tuesday, touching a low of 96.33 in the day trade, down 65 paise. The rupee settled down 57 paise at 96.27 against the US dollar.
“Domestic equities came under renewed pressure as escalating West Asia tensions drove crude oil prices sharply higher, reviving fears that global energy supply will further delay a recovery in India’s corporate earnings,” Vinod Nair, Head of Research, Geojit Investments Ltd, said.
The pain was compounded by the rupee breaching the 96-per-dollar mark, fanning concerns over imported inflation, he added.
Meanwhile, wholesale price inflation shot up to 9.87 per cent in June, from 9.68 per cent in May, led by a sharp spike in prices of food and non-food items.
Broader markets also closed lower as the BSE MidCap Select index tumbled 1.01 per cent and SmallCap Select index declined 0.55 per cent.
Among sectors, BSE MidSmall Private Banks Quality Tilt tanked 1.92 per cent, while Realty (1.91 per cent), PSU Bank (1.79 per cent), Auto (1.53 per cent), Financial Services (1.20 per cent), Bankex (1.16 per cent) and IT (1.09 per cent) also closed lower.
