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Mid-Session: Market bleeds in red on China turmoil; rupee plummets towards 66/dollar Analysis for Aug 21, 2015

By Religare

The Indian equities succumbed to a severe broad-based selling pressure today as traders fret over the health of the world economy with China mired in a steep slowdown, while tumbling currencies and commodities exasperate investor fears, prompting a flight from equities. Selling pressure was visible across all sectoral indices, with rate sensitive realty, auto and banking stocks were worst hit during the day"s trade so far.

At 12:20 hours, the BSE SENSEX was trading at 27194.54, down by 413.28 points or by 1.5 per cent, and the NSE Nifty was quoting 111.5 points lower at 8260.9.


In the choppy trade, the BSE Sensex touched an intraday high of 27442.82 and intraday low of 27131.44, while the NSE Nifty touched high and low of 8305.4 and 8225.05, respectively, during the day"s trade so far.

Early today, Indian rupee plunged to nearly 66 against US dollar as weakness in equity weighed on currency movement. The continued depreciation in the rupee is a major concerns for Indian equities as further depreciation in the local currency may delay an interest rate cut by the Reserve Bank of India (RBI) which meets next on the 29th of September.

Further, concerns about slowing growth in china coupled with dimming hopes of a US rate hike in mid-September also weighed on market sentiment.

Leading the decline on the D-Street were Vedanta Ltd. (Rs. 94.30,-4.26%), Bajaj Auto Ltd. (Rs. 2389.35,-4.12%), Hero MotoCorp Ltd. (Rs. 2545.25,-3.37%), Tata Steel Ltd. (Rs. 233.80,-3.25%), Tata Motors Ltd. (Rs. 331.20,-3.19%), among others.

However, some buying were witnessed in stocks, such as Hindustan Unilever Ltd. (Rs. 878.00,+0.51%), Infosys Ltd. (Rs. 1143.80,+0.49%), among others.

On the sectoral front, all the indices were bleeding in red with rate sensitive realty and auto stocks were worst hit today, losing 3.16 per cent and 2.6 per cent, respectively.

The Market breadth, indicating the overall strength of the market, was weak. On BSE out of total shares traded 2495, shares advanced were 573 while 1849 shares declined and 73 were unchanged.

On the global front, the Asian equities continued to trade under pressure as fears over a China slowdown and sliding emerging market currencies unnerved traders. China"s Shanghai Composite extended a slide after a private manufacturing gauge contracted at the fastest pace since March 2009, coming in at 47.1 in August, with a reading below 50 signaling contraction, stoking more fears over the health of the world"s second biggest economy. Hang Seng tumbled while Japan"s Nikkei 225 was also trading deep in the red even as manufacturing activity hit a seven-month high last month.

Story first published: Friday, August 21, 2015, 13:12 [IST]
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