Sensex closes 604 points down, banking stocks plunge

Negative global cues and a weak rupee led a benchmark index of Indian equities markets, the 30-scrip BSE Sensitive Index (Sensex) to plunge 604 points or 2.05 percent in Monday's trade.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) also closed the day's trade with heavy losses. It was down 181 points or 2.03 percent at 8,756.75 points.

On the Nifty, the market breadth turned negative as there were only 982 stocks advancing against 1,883 stocks declining.

The S&P Bombay Stock Exchange (BSE) Sensex, which opened at 29,316.54 points, closed the day's trade at 28,844.78 points, down 604.17 points or 2.05 percent from the previous day's close at 29,448.95 points.

The Sensex had touched a high of 29,321.06 points and a low of 28,799.76 points in intra-day trade.

On the BSE out of 2,973 company's shares that were traded on Monday, 1,889 declined and 977 advanced and 107 remained unchanged.

The losses were so broad-based that all the main indices - S&P 100, 200, mid-cap and small-cap - registered declines.

The S&P BSE mid-cap index closed lower by 1.33 percent. The S&P BSE small-cap index was down 0.94 percent.

The S&P BSE 100 index was down 177.15 points or 1.96 percent at 8,874.56    points. The S&P BSE 200 index fell 69.04 points or 1.86 percent at 3,636.40 points.

The BSE's market capitalisation lost was Rs.157,645.48 crore in the day's trade. The market cap was down Rs.10,411,574 crore from Rs.10,569,219.15 crore as of March 5.
All sector-based indices of the BSE closed the day's trade in the red except for the healthcare index.

Banking, capital goods, IT, metal, automobile, oil and gas and technology, entertainment and media (TECK) came under heavy selling pressure.

The BSE S&P Bank index was down 681.32 points, followed by capital goods index which was lower by 502.02 points, IT index plunged 245.71 points, metal index decreased by 241.39 points, automobile index declined by 213.52 points, oil and gas index fell 163.65 points and TECK index was down 122.71 points.

However, the BSE S&P healthcare index was up 51.01 points.

According to analysts, the Indian markets have reacted negatively to the sharp increase in the US non-farm payroll data for January. It rose by 295,000 jobs last month. The unemployment rate fell to 5.5 percent from 5.7 percent in January 2014.

The Indian markets were anxious as rapid increases in non-farm payroll data might lead to an increase in inflation.

This can make the US Federal Reserve raise interest rates sooner than previously expected. With higher interest rates, foreign institutional investors will be led away from emerging markets such as India.

"In the coming week the Indian market will be cautious as the US non-farm payroll data has gone up rapidly. This might lead to a sooner than expected interest rate rise in the US," ZyFin Advisors chief executive Devendra Nevgi told IANS.

Market analysts also said that post the union budget and the Reserve Bank of India's rate cut, the Indian markets are currently deprived of any new triggers.

"The next momentum will depend on the budget Session, where expectations are high. In the meantime the market has looked at global concerns on the US rate hike and negative development in Grexit," said Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services.

The major Sensex gainers were: Hindustan Unilever, up 3.76 percent at Rs.974.30; DrReddy's Lab, up 0.68 percent at Rs.3,462.70; Sun Pharma, up 0.41 percent at Rs.1,041.65 and Maruti Suzuki, up 0.01 percent at Rs.3,673.90.

The losers were: Sesa Sterlite, down 5.21 percent at Rs.199.15; Hindalco, down 4.70 percent at Rs.140.95; BHEL, down 4.55 percent at Rs.257.25; Gail, down 4.52 percent at Rs.385.75; and ICICI Bank, down 4.33 percent at Rs.332.70