Sensex, Nifty tank on global trade war jitters
Mumbai: Benchmark indices reeled for the sixth straight session on Wednesday, reflecting losses in overseas markets after the exit of a key White House economic adviser sparked fears of a global trade war.
The BSE Sensex plunged over 284 points to close at a three-month low of 33,033, while the broader Nifty shed 95 points to end below the 10,200-mark. Banking stocks suffered yet another day of losses as the government widened probe into the country’s biggest bank fraud at Punjab National Bank (PNB).
Markets across Asia and Europe slumped following the resignation of White House’s top economic adviser Gary Cohn, reportedly over differences with US President Donald Trump on trade policy and protectionism.
The 30-share Sensex tumbled by 284.11 points or 0.85% to end at 33,033.09, its lowest closing since 7 December when it had ended at 32,949.20. Intra-day, it shuttled between 32,991.14 and 33,331.21. The index has now lost 1,412.66 points in six sessions.
The broader NSE Nifty dipped below the 10,200-mark to finish at 10,154.20, down by 95.05 points, or 0.93%. “Weak global cues due to escalating trade war concerns and widening probe into PSU banks led the domestic market to under-perform. From the recent high the market declined by 9 per cent as investor sentiment got hurt by domestic and global headwinds. Consolidation in bond yield and ease in global market volatility is likely to provide some leeway to the current negative sentiment,” said Vinod Nair, head of research, Geojit Financial Services.
Meanwhile, domestic institutional investors (DIIs) net sold shares worth Rs734.33 crore, while foreign portfolio investors (FPIs) bought shares to the tune of Rs620.08 crore on Tuesday. Banking stocks led by SBI, PNB, ICICI Bank, Federal Bank, Bank of Baroda, Yes Bank, Axis Bank, HDFC Bank and IndusInd Bank suffered losses of up to 3.84%.
Punjab National Bank (PNB) managing director and chief executive officer (CEO) Sunil Mehta on Wednesday appeared before the Serious Fraud Investigation Office (SFIO) after being summoned for recording his statement in connection with the Rs12,636 crore fraud at the bank.
On Tuesday, officials from Axis Bank and ICICI Bank had also appeared before the SFIO, which is the investigating arm of the ministry of corporate affairs. SFIO is also expected to summon officials of nearly 31 banks which have exposure to the companies of diamond traders Nirav Modi and Mehul Choksi.
Shares of Gitanjali Gems slumped 5% to hit its fresh 52-week low. This is the 15th straight session of fall for the stock. It has lost as much as 80% since 14 February, when the PNB fraud came to light. PNB share lost 2.25%.
All sectoral indices, barring FMCG and consumer durables, ended in the red. Index losers included Adani Ports, Bharti Airtel, ONGC, RIL, Tata Steel, L&T, M&M, Sun Pharma, Dr Reddy’s, TCS, Infosys, Wipro, Hero MotoCorp and Power Grid, declining up to 6.53%. However, ITC, Maruti Suzuki, Bajaj Auto, Asian Paints, Kotak Bank and NTPC rose up to 1.05%. In the broader market, the BSE small-cap index fell by 2.16% while the mid-cap index shed 1.32%.
In the Asian region, Japan’s Nikkei shed 0.77%, Hong Kong’s Hang Seng fell 1.03%, while Shanghai Composite Index ended lower by 0.55%. Europe displayed a similar trend. Paris CAC 40 was down 0.26% and Frankfurt’s DAX edged lower by 0.13% in early deals. London’s FTSE too shed 0.26%.
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