The BSE benchmark Sensex on Monday slumped by 134.26 points to end at nearly two-week low of 19,293.20 as a proposed bailout of Cyprus rattled global markets and local investors adopted a cautious stance ahead of RBI monetary policy meeting on Tuesday.
The Bombay Stock Exchange 30-share barometer resumed sharply lower and moved in a narrow range in negative terrain throughout the day to settle at 19,293.20, a fall of 134.36 points or 0.69 percent. Last Friday, it fell by 142.88 points.
Shares from metal, PSU, auto, realty and refinery sectors suffered the most while defensive stocks from FMCG and pharma segments attracted some buying support.
The NSE 50-issue CNX Nifty also dropped by 37.35 points or 0.64 percent to more-than one-week closing low of 5,835.25.
“The Cyprus issue created an initial panic in the Indian markets, which opened gap-down. For rest of the day, markets did recover a bit but remained on tenterhooks,” said Nagji K Rita, Chairman & MD, Inventure Growth & Securities.
On March 16, Cyprus got Euro 10 billion package from lenders but planned to impose a one-time levy on money held in island’s bank accounts as a part of a sovereign bailout.
Business-friendly Cyprus has treaties on double taxation with many nations, making it attractive for investors.
Brokers also said funds turned cautious and investors offloaded part of their positions before the Reserve Bank of India policy meeting on Tuesday. ICICI Bank dropped by 1.50 per cent and HDFC Ltd by 1 per cent.
Among other rate-sensitive stocks, DLF fell by 0.84 per cent, Unitech by 3.15 per cent, Maruti Suzuki by 2.98 percent, Bajaj Auto by 2.06 per cent and Tata Motors by 1.55 per cent.
Globally, Asian stocks closed down with losses between 0.90 per cent and 2.71 per cent after last week’s Cyprus bailout prompted uncertainty in global markets.
European markets were also trading lower in early deals.
The CAC was down by 1.22 per cent, the DAX by 0.96 per cent and the FTSE by 0.71 per cent.
Sensex stocks like RIL, ICICI Bank, Infosys, Tata Motors, M&M, Maruti Suzuki, Tata Power, Bajaj Auto, GAIL Ind, Sterlite Ind and Tata Steel closed with sharp to marked losses.
Coal India tanked 5.41 per cent on reports that the government is considering a stake sale in the PSU major. The stock also turned ex-dividend on Monday.
Outside of indices, Jet Airways slid 2.7 per cent on worries over the proposed deal with Etihad.
In Sensex, 24 out of 30 Sensex-based scrips finished down. Top losers included Tata Power (3.43 pc), Gail India (3.16 pc), Maruti Suzuki (2.98 pc), Sterlite Ind (2.68 pc), Bajaj Auto (2.06 pc), Wipro (1.68 pc), Tata Motors (1.55 pc), ICICI Bank (1.50 pc), Tata Steel (1.48 pc), RIL (1.45 pc), Dr Reddy’s Lab (1.27 pc), M&M (1.26 pc), and Infosys (0.77 pc).
Among sectoral indices, S&P BSE-Metal tumbled by 2.34 per cent, followed by S&P BSE-PSU (1.64 pc), S&P BSE-Auto (1.44 pc), S&P BSE-Realty (1.21 pc) and S&P BSE-Oil&Gas (1.20 pc).
“RBI is likely to cut the repo rate by 25bps considering sustained moderation in core inflation, non—populist Budget showcasing commitment to fiscal consolidation and sharp slowdown in GDP growth to decade—low levels. A CRR cut is unlikely,” said Amar Ambani, Head of Research, IIFL.
Meanwhile, Foreign institutional investors (FIIs) picked up shares worth a net Rs 1,018.93 crore on last Friday, as per provisional data from the stock exchanges.
The total market breadth was negative as 1,757 stocks closed with losses while 1,091 that settled with gains. Total market turnover was sharply down at Rs 1,755.57 crore from Rs 2,265.82 crore last Friday.
