Sensex Falls Nearly 500 Points on Global Selloff: 10 Developments

BSE Sensex and Nifty fell nearly 2 per cent in afternoon trade, tracking big losses in European markets. Banking, metal and capital goods stocks were among the major losers. The Sensex fell 491 points while Nifty slumped to 7,818 at day’s low.

Here are top 10 developments:

1) Banking stocks fell today on profit-taking after outperforming in the past three sessions. The index for banking stocks, Bank Nifty, fell nearly 1.8 per cent. Yes Bank and PNB fell over 3 per cent while Kotak Mahindra Bank and SBI were down nearly 2 per cent.

2) Metal and capital goods stocks were also under pressure today with Vedanta and Hindalco slumping over 5 per cent while L&T fell over 3 per cent.

3) Analysts say that Indian markets are likely to remain volatile ahead of the expiry of September derivative contracts on Thursday.

4) Traders are also likely to remain cautious because this is a truncated week, analysts say. Markets will be closed on Friday due to a holiday.

5) Also, keeping traders cautious, the Reserve Bank will announce its monetary policy on September 29.

6) A 25-basis point rate cut is already factored in, say analysts; the RBI could surprise with a 50-basis point cut, they say.

7) Traders will be closely tracking foreign funds, which bought Indian equities (net) of Rs 154.87 crore on Monday.

8) Analysts say the sustainability of the fund flow needs to be watched as foreign funds have been big sellers of Indian equities this month. FIIs had sold a record Rs 16,877 crore (net) worth of domestic stocks in August, leading to the recent selloff in Indian markets.

9) Traders would also be closely tracking the rupee. The rupee was higher at 65.62/dollar against its Monday’s close of 65.72/dollar.

10) Asian shares ended mostly higher today with China markets rising nearly 1 per cent. Major European markets were down over 1.5 per cent.