Sensex slumps more than 500 points
Updated On : November 15, 2016 4:15 pm
The country's wholesale price index-based inflation also eased to a four-month low of 3.39 per cent in October from 3.57 per cent in September.
The demonetisation wave hit share market in the country on Tuesday amid the fears over contraction of growth in the near term while rising US bond yields sparked concerns over foreign capital outflows.
In the closing of markets, S&P Bombay Stock Exchange (BSE) Sensex ended down 514 points at 26,305 and the Nifty50 settled 188 points lower at 8,108. Sensex hit the lowest during the day at 550 points down, while Nifty saw the lowest at 212 points. It was in the broader market that BSE Midcap and Smallcap ended down 4 per cent-5 per cent each. It was also noticed that market breadth ended weak with 2351 losers and 349 gainers on the BSE.
The country’s wholesale price index-based inflation also eased to a four-month low of 3.39 per cent in October from 3.57 per cent in September.It was noticed that even though the rate of price rise was up slightly in both manufactured and fuel items comprising, which constitute 80 per cent, it was mainly food products which pulled down inflation.”The price rise as indicated by this index had moderated at 3.4% compared with September.
However, we do expect this rate to be between 3.5-4% for the rest of the year. The inflation numbers this year so far have been in the lower range compared with the build-up over March which is higher at 4.3% with primary articles witnessing increase of 6.4% and fuel products 8.6%. Some moderation could be expected on food side due to the good harvest. Fuel inflation however would continue to be elevated,” says Anushka Sawarkar, Associate Economist, CARE Ratings, in a report of Business Standard.
Reportedly, consumption-led sectors such as fast moving consumer goods and consumer discretionary were the most hit because cash comprises a significant percentage of the transactions while non-banking finance companies and realty sectors were also among significant losers.
The reports added that the 10-year US benchmark bond yields have been on the uptick after President-Elect Donald Trump announced increase in fiscal spending on infrastructure while inflation pressures also raised prospects of a rate hike by the US Federal Reserve sooner than expected.