Incidentally, the Indian markets slipped further in the last hour of the trade amidst a weak opening in the European markets.
Global weakness on account of the crash in Argentina’s peso, political unrest in Hong Kong and the long-drawn U.S.-China trade war led to the Indian benchmarks losing heavy ground on Tuesday, even as strong gains in Reliance Industries (RIL) helped the indices limit the day’s losses.
The 30-share Sensex lost 623.75 points or 1.66% to close at 36,958.16, which was only marginally above the day’s low of 36,888.49. This was the second-highest single day fall for the Sensex in the current calendar year after July 8 when it had lost 793 points or 2.01%.
The Sensex losses were led by the the HDFC pack – HDFC Bank and HDFC – along with banking and auto majors like Yes Bank, M&M, Bajaj Finance and Maruti Suzuki India among others. According to Society of Indian Automobile Manufacturers (SIAM), sale of passenger vehicles fell nearly 31% in July.
Interestingly, RIL was the saviour for the benchmark on Tuesday as the diversified conglomerate, which has the second-highest weightage in the Sensex, gained over 12% during intra-day trades on the back of the slew of announcements it made at its annual general meeting on Monday.
Shares of RIL finally settled at 1,275, up 9.72% thereby contributing nearly 360 points to the Sensex, which still closed deep in the red as 28 of its constituents lost ground. Meanwhile, the broader Nifty again fell below the psychological 11,000-mark to close at 10,925.85, down 183.80 points or 1.65%.
“The correction in the Indian market was largely driven by escalating trade tensions between US and China coupled with political unrest in Hongkong and Venezuela and crash in Argentina currency,” said Sanjeev Hota, Head – Research, Sharekhan.
“Excluding Reliance, which was up by almost 10% in intra-day trade, Sensex was down by more than 1,000 points in intra-day trade. The volatility in the market could continue for some more time till clarity emerge in the trade wars and some favorable measures from government to boost the equity market,” he added.
Incidentally, the Indian markets slipped further in the last hour of the trade amidst a weak opening in the European markets as investors remained jittery due to the worrisome reports coming from Argentina and Hong Kong.
In Argentina, stocks and currency plunged after President Mauricio Macri suffered a shock defeat in elections, while political unrest has been simmering in Hong Kong with flight check-in at its airport – one of the busiest in the world – remaining suspended for the second successive day.
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