News Column

Sensex snaps winning spree, falls 646 points

August 2, 2014

PTI



Mumbai: The benchmark S&P BSE Sensex snapped its last two-week gaining spree, tumbling 646 points to end below 26,000 level at almost three-week low of 25,480.94 on cautious approach adopted by operators and retail investors ahead of the RBI's monetary policy next week.



Offloading long positions from operators in view of expiry of July-contract on Thursday, weak global cues, continuing geo-political tensions also affected the sentiment.



Weakness in the rupee against the dollar, as the domestic unit touched 61-mark after three months, was also the factor behind fall in share values.



Shares of capital goods, refinery, metal, power, realty, PSU, consumer durables, IT, auto and banking declined sharply on heavy selling pressure.



Small-cap shares also moved down on fresh selling from retail investors.



"The overall sentiment also remained downbeat after India's fiscal deficit crossed half the budget estimate in the first three months of the fiscal," said Jayant Manglik, President-retail distribution, Religare Securities.



The Sensex resumed higher at 26,173.47 and moved up to 26,181.83 but declined afterwards to 25,459.13 before ending at 25,480.84, showing a loss of 645.91 points or 2.47 per cent.



The NSE 50-share Nifty also fell by 187.85 points or 2.41 per cent to 7,602.60.



Forex

After taking a respite for a week, the Indian rupee continued its downslide and tumbled by 108 paise to end the truncated week at more-than four-month low of 61.18 against the Greenback on distinctly weak local equities amid fresh dollar demand from importers.



The Forex market was closed on July 29 on account of "Eid".



Importers and some banks bought dollars and short-sellers covered their positions on hopes of further hike in the dollar value after the US Fed recently trimmed its monthly economic stimulus by $10 billion. The dollar too gained against most peers as the American economy grows stronger, impacting negatively on the rupee value.

Fresh selling by Foreign Institutional Investors (FIIs) also put pressure on the rupee. FIIs pulled out $277.78 million on first three trading sessions of the week, as per Sebi data.




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Source: Times of Oman


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