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Sensex Tanks Over 570 Points Fearing Oil Output Cut, Trade War

Sensex Tanks Over 570 Points Fearing Oil Output Cut, Trade War

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  7 Dec 2018 6:19 AM GMT

Mumbai: Fears over a rise in global trade protectionist measures and a possible crude oil production cut by the OPEC pulled the barometer S&P BSE Sensex index lower by over 570 points on Thursday.

Market observers said the Indian stock indices fell in line with their global peers in Asia and Europe even as outflows of foreign funds, weak rupee and uncertainty over the outcome of Assembly elections also weighed on investor sentiments.

Selling pressure was seen across all sectors which was led by energy stocks, which shed 2.52 per cent, the most on the BSE, followed by realty and auto stocks.

Besides, crude oil prices remained volatile amid expectations of supply cuts by OPEC, the group of 15 of the world’s top oil producers which is to meet on December 7.

“Investors are closely watching the meeting between the OPEC and other top oil-producing countries. Investors also turned cautious in the run up to the results of five state elections,” said Abhijeet Dey, Senior Fund Manager-Equities, BNP Paribas Mutual Fund. Brent crude oil price slipped to $60.46 per barrel when the markets closed.

“The election result is likely to set the tone for the general elections,” Dey said.

Centrum Broking’s Senior VP and Head of Research (Wealth) Jagannadham Thunuguntla said: “Capital markets had a rough day as they are trying to navigate too many data points such as re-emergence of sharp weakness in Indian rupee, upcoming OPEC meeting outcome in terms of production cut and election results.

“The nervousness is quite evident as there is sharp sell-off across the industries, especially in those stocks where there are corporate governance concerns.”

Globally, all the Asian markets closed on a negative note while the European indices like FTSE 100, DAX and CAC 40 were trading deep in the red.

The Indian rupee closed at Rs 70.90 to a US dollar from its previous close of Rs 70.46. It had weakened to the 71-mark during the afternoon trade session.

The Sensex settled lower 1.59 per cent, or 572.28 points, at 35,312.13, from its previous close of 35,884.41. It touched an intra-day high of 35,707.23 and a low of 35,266.76.

The NSE Nifty50 lost 181.75 points or 1.69 per cent to close the session at 10,601.15. The market breadth was negative as a number of declining stocks was thrice the advancing ones. A total of 656 stocks advanced while 1,814 declined.

“Technically, with the Nifty correcting further, the underlying bias remains weak. Traders will need to watch if the index can now hold above the crucial immediate supports of 10,527; else a further correction is likely,” said Deepak Jasani, Retail Research Head, HDFC Securities.

Selling by foreign institutional investors (FIIs) and domestic institutional investors (DIIs) continued on Thursday. Provisional figures from the BSE showed that FIIs sold stocks worth Rs 357.82 crore and DII off-loaded shares worth Rs 791.59 crore.

Sun Pharma was the lone gainer on BSE which advanced 1.57 per cent to Rs 420.10 as investors bought its shares on lower price level as it had lost over 15 per cent in just the last three trade sessions since Monday. The pharmaceutical major is probed by SEBI on several charges of corporate disclosure and insider trading.

The laggards were led by Maruti Suzuki, Tata Motors and Tata Motors(DVR) which lost over 4 per cent, while Yes Bank, Adani Ports and Reliance Industries lost in the range of 2-3 per cent. (IANS)

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