Stock Market Fall: Due to strong employment data in America and selling by foreign investors, there has been a big fall in the stock market. Sensex fell 1129.19 points to 76249.72 intra-day. Due to this, investors have lost Rs 12.52 lakh crore. More than 700 shares hit lower circuit on BSE. While 508 shares reached the year’s lowest level.
Sensex closed 1048.90 points down at 76330.01 and Nifty closed 345.55 points down at 23085.95. Stronger than expected US employment data dashed expectations of a rate cut by the Fed. The rupee has also fallen against the dollar. Apart from this, the impact of the decline in most of the stock markets globally was also seen on the domestic market.
Smallcap index fell by more than 2000 points
Heavy selling was seen in small cap shares. The result was that the BSE Smallcap Index fell by 2180.44 points. Out of 938 shares included in the index, 899 shares recorded a decline of up to 20 percent. Whereas 39 shares improved by up to 8 percent. A big decline has also been recorded in midcap shares. The index has declined by 4.17 percent (1845.18 points). In the midcap segment, Crisil, Biocon, Aditya Birla Capital, Star Health improved by 0.49 per cent to 2 per cent. Whereas in all others a difference of up to 10 percent has been recorded.
Realty stocks attracted investors
Realty shares witnessed the biggest decline in the stock market today. All the shares included in the index fell by 10 percent. With this, BSE Realty Index fell by 6.59 percent. The reason for the divergence in realty stocks is that high loan rates are likely to persist. The weakening of the rupee against the dollar has increased the likelihood of inflation and thus a rise in interest rates. Apart from this, there has been a decline of 4.23 percent in Power Index, 3.24 percent in Oil and Gas, 3.196 percent in Consumer Durables, 3.58 percent in Capital Goods and 3.17 percent in Metal.
Reasons behind stock market crash
The growth of the infrastructure sector is likely to slow down with the country’s GDP growth forecast being reduced to 6.4 per cent by the RBI and various rating agencies. The fear of inflation has also increased due to the rupee being at its lowest level against the dollar. Strong employment data in the US has dimmed expectations of a Fed rate cut. Additionally, profit booking has increased due to stock specific rally in the last few months. FIIs have been net sellers.
