The Sensex crashed in trade after reports that the TDP had moved a no confidence motion and would be supported by several parties. The TDP said it was quitting the NDA over unhappiness at Andhra Pradesh not being given special status and had moved a no confidence motion.
Though there was no threat to the Narendra Modi government, sentiments took a turn for the worse.
The Sensex was down 510 points and the Nifty was down 165 points in trade by the end of the day. With this Sensex has slumped for 4th straight trading session, after having recovered a staggering 600 points in Monday.
Coal India was the top loser from the Nifty after the stock wend ex dividend. NTPC, Tata Motors and heavyweight Reliance were the other shares that lost ground.
Shares in JP Associates rallied after investor Rakesh Jhunjhunwala's Rare Enterprises bought a stake in the company. The stock had surged as much as 20 per cent on Thursday. Volumes in the counter were significant.
Shares in ITDC gained as much as 10 per cent on the back of heavy volumes. The shares were last trading at Rs 498, after rallying to as high as Rs 515, during the course of the day.
Oil marketing companies take a hit
Oil marketing companies were taking a small hit with shares like BPCL, HPCL and Indian Oil losing 1-2 per cent. This was largely on the back of higher crude prices. Meanwhile, Asia closed subdued, though Europe was trading with gains.