Bombay Stock Exchange (BSE) building in Mumbai. file | Photo credit: The Hindu
Falling for the third straight session, equity benchmark Sensex plunged nearly 900 points to close below the 59,000-mark on Monday due to heavy selling in banking, finance and auto stocks amid one of the US Bank’s biggest failures.
Besides, unabated foreign fund outflows amid fears of a global rate hike and a weak domestic currency added to the gloom, traders said.
After rallying 375 points in early trade, BSE Sensex could not hold on to gains and settled 897.28 points, or 1.52%, lower at 58,237.85, as 29 of its constituents declined, while only one advanced. It touched a low of 58,094.55 and a high of 59,510.92 in the day’s trade.
The NSE Nifty closed 258.60 points, or 1.49%, down at 17,154.30, with 45 stocks ending in the red.
IndusInd Bank was the biggest loser in the Sensex pack, shedding 7.46%, followed by SBI, Tata Motors, M&M, Bajaj Finserv, Axis Bank and Infosys.
In contrast, Tech Mahindra was the sole winner.
In the broader market, the BSE Smallcap gauge fell 2.08% and the Midcap index fell 1.82%.
US-based SVB Financial, which mainly funds startups, crashed 60% in the US market last week, raising concerns over the health of banks’ bond portfolios and its potential impact globally.
“…panic over the biggest US bank failure since the 2008 financial crisis, prompting investors to seek safe-haven assets,” said Navneet Damani, senior VP of commodity research at Motilal Oswal Financial Services.
In Asian bourses, Shanghai, Hong Kong and Seoul ended in the green, while Tokyo closed lower.
European stock markets were trading with heavy losses in the afternoon trade.
Meanwhile, the rupee depreciated 10 paise to close at 82.16 against the US dollar on Monday.
International oil benchmark Brent crude fell 1.79% to $81.30 a barrel.
Foreign portfolio investors (FPIs) sold shares worth Rs 2,061.47 crore on Friday, according to exchange data.