Sensex tanks over 535 points in pre-close session

Sensex tanks over 535 points in pre-close session

Mumbai: The BSE Sensex tumbled the most in a month in pre-close trading on Thursday by losing over 535 points on brisk selling by funds, amid rise in inflation that signalled a possibility of another hike in interest rates.

The Bombay Stock Exchange’s Sensex lost 535.08 points to 19,161.40 at 15.00 hrs with most of the heavy-weights led by banking and realty sector stocks losing notable ground.

The broad-based National Stock Exchange index Nifty dropped by 158.55 points to 5,745.15 at the same time.

Selling pressure was confined mainly to banking and realty sectors as food inflation rising this week sparked fears that the RBI might jacked up interest rate for the seventh time since March.

A week after declining to an 18-months low, food inflation rose again, albeit marginally, to 8.69% for the week ended 27 November on back of rise in prices of rice, onions, fruits and milk.

The sudden rise in food inflation, after a record fall, is likely to be a cause of worry for the government which was looking at a decline in the overall inflation to 6% by March next year.

Overall inflation, which also takes account of manufactured goods, primary articles and fuels, was 8.58% in October.

The data for November is expected next week.