Sensex in India Plunges 5.9% as Global Markets Dive Second Week

Mukesh Buch
24 Aug, 2015
New York City

Stock markets plunged nearly 6%, the biggest falls since January 2009 after a sell-off in Shanghai for the second week extended global market losses of more than 10% from the recent highs. Central government plans to sell 10% stake in India Oil and raise up to $1.5 billion.

[R]6:00 PM Mumbai – Stock markets plunged nearly 6%, the biggest falls since January 2009 after a sell-off in Shanghai for the second week extended global market losses of more than 10% from the recent highs. Central government plans to sell 10% stake in India Oil and raise up to $1.5 billion.[/R]

Financial markets around the world deepened losses and Asian markets extended losses of the last three weeks after markets in New York and in Europe dropped nearly 10% from the peak.

World markets have been fragile for the several month on the stretched valuations in developed markets, weakening commodities prices and lack of growth in the euro zone.

In addition, emerging markets suddenly faced currency war after China devalued currency two weeks ago and foreign investors are estimating that the economy is slowing down faster than the government data suggest.

India’s stock market indexes plunged nearly 6% on Monday, posting their largest one-day decline since January 2009.

Among the Sensex stocks are, Vedanta Ltd fell 15.3%, Tata Steel Ltd fell 13.1%,

Energy linked stocks and banks led the decliners.

GAIL India Ltd 12.8%, ONGC 11.2%, ICICI Bank Ltd 8.9%, Reliance Industries Ltd 8.6%.

Rupee weakened 82 paisa to 66.64 against one U.S. dollar.

The Sensex Index tumbled 1624.51 or 5.9% to close at 25,741.56. The CNX Nifty declined 490.92 or 5.9% to 7,809.

For the year so far, the Sensex has dropped more than 9% from its recent peak in July and struggled to rebound from its low in mid-June.

Gainers & Losers

Coal India Limited dropped 3.6% to ₹336.30 after the coal miner said it plans to invest about ₹5,900 crore and increase annual production to 1 billion or 100 crore tons by 2020.

Dr. Reddy''s Laboratories Limited slipped 4.6% to ₹4,045.50 after the generic pharmaceutical products maker recalled one batch of USP 1.5 mg Rivastigmine Tartarate capsule from the U.S. market.

Indian Oil Corporation Limited declined 4.9% to ₹376.20 after the central government said it plans to sell 10% stake in the oil retailer and raise up to ₹9,500 crore.

NHPC Limited tumbled 9.3% to ₹16.05 after the hydroelectric power generator plans to raise up to ₹2,500 crore through a bond offering.

Steel Authority of India Limited plunged 9.1% to ₹50.60 after the government proposes to revive Visvesvaraya Iron & Steel unit with an investment of ₹1,000 crore.