Sensex suffers biggest single-day fall in 7 months as financial stocks retreat

Mumbai: Benchmark BSE Sensex Monday suffered its worst single-day loss in seven months, extending its fall for a fifth day due to a meltdown in banking and auto stocks on liquidity concerns and a rout in global markets.

The 30-share index tanked 536.58 points or 1.46 per cent to settle at a two-month low of 36,305.02, logging its biggest single-day loss since February 6 when it declined by 561.22 points.

This is the weakest closing since July 11 when it settled at 36,265.93. The index dropped a total 1,785.62 points or more than 5 per cent in five sessions, wiping out Rs 8.48 lakh crore of market wealth.

Factors like crude oil prices hitting a four-year high, liquidity concerns after defaults by IL&FS, the rupee retreating a low of 72.73 against the US dollar beset investors.

The broad-based Nifty of the National Stock Exchange crashed below the 11,000 mark, declining by 168.20 points or 1.51 per cent to end at 10,974.90.

Liquidity concerns and reports that China has called off planned trade talks with the US weighed on the market sentiment, brokers said.

Brent crude prices hit a four-year high before trading up 2.34 per cent at $80.07 a barrel while WTI gained 1.81 per cent to $72.06 a barrel.

Of the 30 Sensex scrips, 24 declined with Mahindra & Mahindra emerging as the biggest loser. Mahindra and Mahindra fell by 6.46 per cent while Maruti and Bajaj Auto decline by 3 per cent and 1.7 per cent respectively.

Financial stocks led by HDFC also took a hit. HDFC dropped 6.22 per cent, IndusInd Bank by 4.94 per cent, ICICI Bank by 2.8 per cent, Kotak Bank by 2.6 per cent, HDFC Bank by 2.16 per cent, and SBI by 2.04 per cent.

Yes Bank fell by another 0.35 per cent, taking its total losses to more than 29 per cent after the RBI curtailed the term of its founding CEO Rana Kapoor.

The Reserve Bank of India (RBI) and market regulator Sebi said Sunday that they were closely monitoring the developments in the financial sector and were ready to take "appropriate actions" to calm the jittery investors.

Other index losers included Bharti Airtel, Adani Ports, Tata Motors, Tata Steel, Asian Paint, Wipro, Hero MotoCorp, Sun Pharma, HUL, ITC Ltd, L&T and PowerGrid which fell up to 4.94 per cent.

Bucking the trend, IT stocks TCS and Infosys rose by 4.5 per cent and 1.5 per cent. Coal India rose by 2.1 per cent while Reliance gained 1.27 per cent.

In the broader market, the BSE small-cap index fell by 2.72 per cent while the mid-cap index shed 2.40 per cent.

Aviation stocks fall as brent crude price crosses $80 per barrel.

SpiceJet stock fell by 7.20 per cent to Rs 71.50 and InterGlobe Aviation stock was down 4.97 per cent to Rs 860.65.

In the sector terms, the BSE realty emerged worst performer by crashing 5.10 per cent, followed by auto 3.75 per cent, finance 3.46 per cent, telecom 3.30 per cent, healthcare 2.71 per cent, bankex 2.37 per cent, infrastructure 2.37 per cent and FMCG 2.09 per cent.

While IT and teck indices managed to end in the positive zone on weakening rupee.