Rupee breaches 63-mark; stock markets plunge
Mumbai: The woes of rupee and the stock market Monday showed no signs of ending with the currency tumbling by 148 paise - the single largest drop in a decade - while Sensex slumped by 291 points as investors appeared unconvinced that there will be no more capital control steps.
After the Friday mayhem in both the markets on the back of fears over a roll-back of stimulus in the US, the weekend provided no respite as rupee opened sharply lower at 62.30 a dollar from its previous close of 61.65.
It continued to slide through the day today and touched yet another all-time low of 63.30 but ended marginally higher at 63.13 against the US dollar, recording the single biggest fall on a day in more than 10 years. Previously, it had plunged by 124 paise on September 22, 2011.
The fall in rupee value would mean further problems in controlling the widening current account deficit and would make goods across sectors from fuel to automobiles costlier.
FII selling in shares of banks, auto, pharma and FMCG eroded Rs 1 lakh crore in investor wealth with Sensex ending at four-month low of 18,307.52, a drop of 290.66 points.
Similarly, the 50-issue NSE CNX Nifty also dipped by 93.10 points, or 1.69 percent, to end at 5,414.75 -- the lowest close since September 2012.
Finance Minister P Chidambaram was closetted with his top officials reviewing the situation but unlike Friday none of them offered comments on neither the fall in rupee nor the Sensex crash.
On a day when the financial markets melted, gold prices eased a bit, slipping from an eight-month high. It lost Rs 165 to end at Rs 31,360 per ten grams in the national capital today while the precious metal ended Rs 40 higher at Rs 31365 in Mumbai.