The BSE Sensex slumped over 300 points tracking the Indian rupee, which hit a record low after breaking past the 61 mark against the dollar. The 50-share Nifty benchmark traded below the key 5,800 mark, falling 80 points.
The rupee fell to a record low as an emerging markets selloff after strong U.S. jobs data laid bare the currency's vulnerability and dependence on capital inflows to fund its record current account deficit. The rupee was at 61.14 as of 09.41 a.m., breaching the previous low of 60.76 hit on June 26. It had closed at 60.225/235 on Friday.
The selloff in equity markets was led by banking stocks, with the Bank Nifty on the National Stock Exchange falling nearly 2 per cent. Banking stocks have large weightage on the benchmark indices and a sharp selloff in banking stocks pulls the entire markets down.
Siddharth Teli of Religare Capital Markets told NDTV banks will not have a direct impact of the weak rupee, but the sharp depreciation in the currency is clearly a sentiment dampener.
"The Reserve Bank's ability to cut rates is limited at this point of time. For PSU banks, there are no signs of respite. Q4 numbers were bad on the back of asset problems and given that PSU banks have been cutting rates, margins would be under pressure in the first quarter too," Mr Teli added.
Bank of Baroda shed over 2.5 per cent, while ICICI Bank traded with over 2 per cent cuts. State Bank of India, the country's biggest lender, traded 1.8 per cent lower.
Only four stocks traded higher on the Nifty. IT major Infosys gained 1.2 per cent ahead of its Q1 earnings on Friday. HCL Tech was the top Nifty gainer, up 2 per cent. IT companies' margins are expected to rise because a falling rupee is good for exporters.
 |
| Sensex fall |
The rupee fell to a record low as an emerging markets selloff after strong U.S. jobs data laid bare the currency's vulnerability and dependence on capital inflows to fund its record current account deficit. The rupee was at 61.14 as of 09.41 a.m., breaching the previous low of 60.76 hit on June 26. It had closed at 60.225/235 on Friday.
The selloff in equity markets was led by banking stocks, with the Bank Nifty on the National Stock Exchange falling nearly 2 per cent. Banking stocks have large weightage on the benchmark indices and a sharp selloff in banking stocks pulls the entire markets down.
Siddharth Teli of Religare Capital Markets told NDTV banks will not have a direct impact of the weak rupee, but the sharp depreciation in the currency is clearly a sentiment dampener.
"The Reserve Bank's ability to cut rates is limited at this point of time. For PSU banks, there are no signs of respite. Q4 numbers were bad on the back of asset problems and given that PSU banks have been cutting rates, margins would be under pressure in the first quarter too," Mr Teli added.
Bank of Baroda shed over 2.5 per cent, while ICICI Bank traded with over 2 per cent cuts. State Bank of India, the country's biggest lender, traded 1.8 per cent lower.
Only four stocks traded higher on the Nifty. IT major Infosys gained 1.2 per cent ahead of its Q1 earnings on Friday. HCL Tech was the top Nifty gainer, up 2 per cent. IT companies' margins are expected to rise because a falling rupee is good for exporters.
+Avinash+Gurung+at+the+Gorkha+Rangamanch+Bhavan+in+Darjeeling+on+Saturday;+Bimal+and+Asha+Gurung+in+the+audience.+Pictures+by+Suman+Tamang.jpg)
Post a Comment