Stock indices tumbled on Thursday following bad economic data and an uncertain political situation, which could discourage Foreign Institutional Investors (FIIs) from investing in the country.
The Bombay Stock Exchange (BSE) 30-share Sensitive Index (Sensex) dipped by 291.94 points or 1.55 per cent. The fall was led by realty stocks, by 3.39 per cent, followed by information technology, 2.45 per cent, technology, 2.44 per cent, consumer durables, 2.05 per cent, banks, 1.89 per cent, and metal (1.79 per cent). All sectoral indices ended in the red.
In the last two trading days the Sensex has lost 530.94 points.
The National Stock Exchange’s 50-Share Nifty index closed at 5574.75 with a fall of 98.15 points or 1.73 per cent.
“Political uncertainty, ETF funds and FII sell-off and ever-worsening economic data were the key triggers for the downfall,” said Rajesh Jain, EVP & Head Retail Research, Religare Securities Ltd. Sentiment was also affected by provisional data showing that foreign funds remained net sellers of Indian stocks on Wednesday. Foreign funds sold shares worth Rs. 3.68 billion on Wednesday.
The rupee touched a one-month low against the dollar at 54.87/88 on Thursday, compared to 54.43/44 per dollar in the previous day’s trading.
It touched a low of 54.89 in intra-day trading.
“The rupee remains a play on mixed factors such as poor growth, elevated levels of current account imbalance, short-term debt related inflows and political uncertainty,” said Anindya Banerjee, Currency Analyst, Kotak Securities.