Sensex, Nifty slump 2 per cent on global recession fears

Mumbai: The Indian stock markets’ key indices, Sensex and Nifty, slumped by around 2 per cent on Thursday tracking weakness in the global peers after the US Federal Reserve raised policy rates by 75 basis points, the highest increase since 1994, in order to control inflation that has spiralled to a 40-year high.

India’s benchmark indices started the day in the positive after the overnight Fed’s action on the rate hike. However, it fell sharply in the afternoon tracking weakness in global peers. Selling pressure intensified towards the end of the trading session on fears that the fight against inflation would be longer and the global economy may slip into recession. The US Federal Reserve on Wednesday hiked the policy interest rate by 0.75 per cent or 75 basis points, the sharpest increase since 1994. The Fed’s action came after inflation in the world’s largest economy spiralled to 8 per cent, the highest in four decades.

Stock markets tumbled across the world after the US Federal Reserve rate action.

The 30 stock S&P BSE Sensex slumped 1045.60 points or 1.99 per cent to 51,495.79 points against its previous day’s close at 52,541.39 points.

Earlier, the Sensex started the day with strong gains at 53,018.91 points and rose to a high of 53,142.50 points in the morning trade. However, the index turned negative in the late morning trade. Selling pressure intensified towards the end of the trading session. The Sensex hit a low of 51,425.48 points in the intra-day, the lowest level in a year.

The Indian stock markets witnessed selling pressure for the fifth consecutive sessions. The Sensex had slipped by 152.18 points or 0.29 per cent on Wednesday.

The index had slumped by 153.13 points, 1456.74 points and 1016.84 points in the previous three sessions, respectively.

The broader Nifty 50 of the National Stock Exchange slumped 331.55 points or 2.11 per cent to 15,360.60 points against its previous day’s close at 15,692.15 points.

Earlier, the Nifty 50 started the day sharply higher at 15,832.25 points and rose to a high of 15,863.15 points in the intra-day. The Nifty slipped to a low of 15,335.10 points in the intra-day, the lowest level in a year.

The Nifty had lost 39.95 points or 0.25 per cent on Wednesday.

Nifty metal index crashed by around 5 per cent. Realty, auto, banking and IT indices were among the worst hit.

Tata Steel tumbled 6.04 per cent to Rs 901.70. Tech Mahindra slumped 4.37 per cent to Rs 975.50. Bharti Airtel dipped 4.11 per cent to Rs 653.95. Wipro slumped 4.04 per cent to Rs 422.40.

Selling pressure was across the board. Only one of the 30 scrips that are part of the Sensex closed in the positive. Nestle India rose 0.30 per cent to Rs 16872.80.

Out of the 30 scrips that are part of the Sensex, 19 slumped by more than 2 per cent. The index heavyweight Reliance Industries Limited closed 1.43 per cent down at Rs 2559.20.