Weighed down by fears of an economic slowdown, Indian markets opened with a sharp 5% fall today, though they later tried to recover some of the losses. Despite repeated efforts, the Nifty failed to hold above the 22,000 mark. The Bank Nifty too slipped below 50,000.
The Sensex dropped to an intraday low of 71,425 while the Nifty hit 21,743 before showing some volatility. The midcap index fell as much as 6% and the smallcap index tumbled 7%. Sectors such as IT, metal, media, auto, realty, and oil were all down more than 5%.
Even the start of the RBI’s monetary policy committee meeting today, and speculation that the repo rate could be cut by 25 basis points on Wednesday, failed to support the market.
Shares of Tata Motors tanked 11% after the company suspended shipments of JLR vehicles to the US. Tata Steel shares were down 10%. Altogether, five Tata Group companies in the Nifty 50 lost a combined ₹1.5 lakh crore in market value during the morning session. Trent shares plunged 18%.
At the NSE, only 55 stocks advanced while over 2,500 declined in the morning trade.
Asian markets too saw steep losses, with an average drop of 7%. Hong Kong’s Hang Seng index plunged 11% while China’s Shanghai index dropped 7%.
Billionaire investor Bill Ackman said business leaders have lost confidence in Donald Trump, adding that there are signs of significant erosion in Trump’s political base.
The rupee also fell sharply today. The dollar opened 50 paise higher at ₹85.73 and later eased to ₹85.57. The withdrawal of foreign investors from Indian markets and falling exports are among the key factors weighing down the rupee. The dollar index, which had dipped to 101 in recent days, rose to 103 today.
Gold rose to $3,024 per ounce in global markets, while in Kerala, the price of jewellery gold fell ₹200 per sovereign to ₹66,280.
Crude oil prices declined, with Brent crude falling to $63.78 a barrel.