Nifty ‘flash crash’, reform worries pull down Sensex below 19K
Mumbai: A flash 900-point crash in NSE Nifty index for a brief period this morning and concerns over the fate of big-ticket reforms like raising the FDI cap in insurance, cut short a four-day rally in stock markets with BSE Sensex falling 120 points to end below 19,000 level today.
After gaining around 480 points in past four sessions, the BSE benchmark index opened higher at 19,115.89 after the government yesterday unleashed another round of reforms. However, the Sensex soon dropped over 200 points mirroring a 900-point fall in NSE Nifty due to ‘flash crash’ in Nifty by erroneous orders worth Rs 650 crore executed by broker Emkay Global Financial Services. This halted trade in cash market for 15 minutes, although NSE said its system worked fine without any technical glitch.
Besides, market participants weighed up the fate of the big-ticket economic reforms announced yesterday as some legislations are likely to face stiff opposition in Parliament when they come up for passage, brokers said. The Sensex closed 119.69 points down, or 0.63 per cent, at 18,938.46. The Nifty closed at 5,746.95, down 40.65 points, or 0.70 per cent.
“A healthy up move, on back of fresh reforms, was expected today. However, the initial euphoria evaporated due to confusion from erroneous trades on NSE in morning,” said Milan Bavishi, Head Research, Inventure Growth & Securities. Importantly, some bills need to be approved by Parliament before becoming a reality and notably, the main opposition party, BJP, seems opposed to raising the FDI limits, said brokerage Edelweiss in a report.
HDFC, which lost 4.55 per cent, was the worst hit among 30 Sensex stocks amid reports that global fund house Carlyle has sold a big chunk of its 3.7 per cent stake today. Infosys, ICICI Bank, HDFC Bank, TCS, Sun Pharma and Bharti Airtel also suffered losses while Tata Motors, HUL, RIL, L&T and ONGC rose, cushioning the fall to some extent. Meanwhile, the rupee traded weaker at 51.81 to the dollar, from its last close of 51.74.
Category: Business, Headlines, Stock Markets
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