In India Sensex crashes 1624 points

7 lakh crore of wealth eroded

MUMBAI:  In the worst-ever carnage in stock market, benchmark Sensex on Monday crashed by 1,624.51 points and nearly Rs 7 lakh crore got wiped out from the investors’ wealth as rout in Chinese stocks triggered a global sell-off.

The intra-day fall was even larger at 1,741.35 points –the third biggest ever and highest in over seven years since January 21, 2008, even as finance minister Arun Jaitley and RBI governor Raghuram Rajan, among others, sought to allay the fears and said fundamentals of Indian markets remain strong.

The BSE’s 30-share index closed the day at 25,741.56 points, down 5.94% (1624.51 points), as stocks across all sectors including energy, banking, auto, IT, infrastructure and real estate saw massive selling as investors turned jittery amid a global carnage.

The total investor wealth, measured in terms of cumulative market value of all listed stocks, plunged by nearly Rs 7 lakh crore and crashed below Rs 100-lakh crore mark to end the day at Rs 95,33,105 crore.

The broader 50-share NSE Nifty too witnessed heavy selling pressure and plunged by 490.95 points to 7,809.00.

Asian markets were also in deep red with Shanghai shares closing more than 8% down, while European shares were also down close to 3% in their early trade.

Rajan told a banking conference that India was in a good position relative to other countries to withstand the current global markets volatility.

“India is better placed compared to other countries with low current account deficit, and fiscal deficit discipline, moderate inflation, low short-term foreign currency liabilities, very sizeable base of forex reserves,” he said.

“We will have no hesitation in using our reserves when appropriate to reduce volatility in the rupee.”

 Jaitley also downplayed the sell-off, calling it “transient and temporary in nature”.

“The factors responsible for this are entirely external,” he said in New Delhi. “There is not a single domestic factor in India which has either contributed to it or added to it.”

Analysts believe India’s markets will remain relatively more insulated than other countries. With inputs from Reuters and PTI

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