Sensex dips to 20-mth low on weak Asian cues
The BSE Sensex fell for the fourth session in a row Wednesday to 20-month low, down over 72 points at 15,792.41 amid weak trend in Asia and a dip in banking stocks, which have been hit by Moody's downgrade of SBI.
Banking sector, which has been facing selling pressure in the last few days on account of high interest rates regime, fell further after the credit ratings agency Moody's Investor Service Tuesday downgraded SBI to 'D+' from 'C-'.
SBI was the top loser from the Sensex pack Wednesday, down 4 percent, over its 4.08 percent fall Tuesday.
In all, 13 of the 14 banking sector stocks closed in the red, while only Bank of India (BOI) rpt Bank of India (BOI) closed in the green. Bankex plunged 257.49 points or 2.52 percent and was the top loser from sectoral indices.
The BSE 30-share barometer opened higher and touched 16,044.91, on initial rise in Asian stocks after higher closing on Wall Street Tuesday.
But Asian markets declined later, amid a cut in Italy's downgraded yet again by Moody's, adding to the investor worries over the euro-zone debt crisis. European markets, however, opened higher.
Later, the Sensex dropped after mid-session to a settle at 15,792.41, a fall of 72.45 points or 0.46 percent. Last time, it had settled at 15,790.93 on February 5, 2010.
The NSE broad-based 50-issue Nifty also declined 20.85 points or 0.44 percent to 4,751.30.
"The Indian markets felt the heat of the financial sector. The sentimental impact of SBI downgrade was felt across the sector," Amit Chheda Head Equity at Inventure Growth and Securities said.
In Asia, key indices in Japan, Singapore, South Korea and Taiwan closed down between 2.33 percent and 0.09 percent. China and Hong Kong markets were closed Wednesday.
In Europe, the CAC, the DAX and the FTSE were up between 2 percent and 1 percent in the afternoon.
Had there not been a smart rise in ITC, HDFC, Infosys, L&T, Jaiprakash and DLF, the fall in Sensex would have been much more pronounced.
Overall, 16 out of 30 Sensex scrips closed with losses while others settled with gains. Besides SBI, ICICI Bank tumbled 2.72 percent and HDFC Bank (2.65 percent). Other major losers were Hindalco (3.65 percent), Jindal Steel (2.55 percent), BHEL (2.36 percent), Maruti Suzuki (1.95 percent), Wipro (1.91 percent), HUL (1.53 percent) and RIL (0.67 percent).
However, Jaiprakash Associates rose 3.86 percent, DLF (2.63 percent), Sun Pharma (1.70 percent), Coal India (1.55 percent), ITC (1.46 percent), Tata Power (1.39 percent), HDFC (1.09 percent), Tata Steel (0.86 percent), M&M (0.84 percent) and L&T (0.5 percent).
The total market breadth on the BSE remained negative with 1,642 counters losing ground, as against 1,086 finishing with losses. Total turnover declined to Rs 2,373.27 crore from Rs 2,613,94 crore Tuesday.
The Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) will remain closed Thursday, October 6, for "Dassera".