According to market observers, the slide in the US and Asian markets eroded investors’ risk-taking appetite and at one point plunged the barometer S&P BSE Sensex by over 1,000 points.
In addition, the Indian currency plummeted to a new low of 74.48 to a USD on Thursday morning.
Heavy selling pressure was witnessed in banking, metals, automobile, IT and capital goods stocks. All 19 sector based indices of the S&P BSE traded in the red.
At 11.00 a.m., the broader Nifty50 of the National Stock Exchange traded at 10,198.35 points, down 261.75 points or 2.50 per cent from its Wednesday’s close.
The S&P BSE Sensex, which had opened at 34,063.82 points, traded at 33923.45 points, down 837.44 points or 2.41 per cent.
So far, the Sensex has touched an intra-day high of 34,063.82 points and a low of 33,723.53 points.
“We started with a strong selling due to a weak Asian market given sharp fall in the US market yesterday, fearing that rising interest rates and trade tension is going to impact company’s profitability,” Vinod Nair, Head of Research, Geojit Financial Services, told IANS.
On Thursday, Asian indices were showing a negative trend. Japan’s Nikkei 225 was quoting in red, down by 4.37 per cent while Hang Seng was down by 3.95 per cent, South Korea’s Kospi was also down by 3.63 per cent.
China’s Shanghai Composite index was trading in red, down by 4.74 per cent.
Overnight, Nasdaq closed in red, down by 4.26 per cent while FTSE 100 was also down by 1.29 per cent at the closing on Wednesday.
“IT, banks, realty and metal stocks have fallen the most, while Oil and gas and media stocks have fallen the least. Nifty seems to be in a temporary bottom formation stage which could last a few more days,” HDFC Securities Head of Retail Research Deepak Jasani said.
In terms of currency, the Indian rupee slipped to a fresh record low of 74.48 to a US dollar on Thursday morning after it opened at 74.31 to a dollar at the Inter-Bank Foreign Exchange Market from its previous close of 74.22 (74.2175).