Sensex Plunges 800 Points As Credit Suisse Takeover Fails To Calm Nerves

Asian markets and the Sensex fell despite reports that Banking giant UBS is buying Credit Suisse for almost $3.25 billion. Post lunch sell-off intensified in the markets, with the Bank Nifty leading declines. Through the morning session the markets were lower, even as Asian markets failed to stage any recovery.

The idea of the buyout orchestrated by the authorities of a Credit Suisse buyout, failed to calm jitters in the global stock markets, including India. The Sensex was down a massive 747 points, while the Nifty dropped 222 points in trade at 1.30 pm. Meanwhile, Europe opened slightly lower with the German DAX down 0.50%.

Adani Enterprises, Apollo Enterprises, Hindalco and JSW Steel were among the losers in trade. Among the gainers were BPCL, HUL, ONGC and Dr Reddy's Labs. As many as 122 stocks dropped to 52-week lows data by the National Stock Exchange showed. Global markets have been in some sort of turmoil lately, dragging Indian indices lower as well.

"Going ahead we expect a short term pullback in the market as lower US PPI inflation and slower US retail sales data has led to the hope of lower 25 bps rate hike in the Fed policy meet next week," says Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.

Meanwhile, Swiss authorities pushed for UBS to take over its smaller rival after a plan for Credit Suisse to borrow up to 50 billion francs (USD 54 billion) failed to reassure investors and the bank's customers, AP Reported.

Credit Suisse is among the 30 financial institutions known as globally systemically important banks, and authorities worried about the fallout if it were to fail. The deal was "one of great breadth for the stability of international finance," said Swiss President Alain Berset as he announced it Sunday night, according to the AP report.

With AP and PTI inputs