Stocks extend losses as rupee rout spooks investors

Mumbai, Jun 28 (PTI) Benchmarks nursed losses for the second straight day today after the rupee collapsed to a lifetime low against the US dollar amid firming crude oil prices, sapping investor confidence.

The BSE Sensex slumped 179.47 points to end at 35,037.64, while the broader NSE Nifty shed 82.30 points to 10,589.10.

Barring telecom and metal, all other sectoral indices closed in the red.

The rupee plunged to a fresh record of 69.10 against the dollar in early trade today, before clawing back lost ground.

A weak currency and stubborn global oil prices pose inflationary risks to net energy importers like India.

Global oil prices have climbed to about USD 78 a barrel after the US asked its allies to end all imports of Iranian oil by November. Concerns over supply disruptions in Libya and Canada also pushed prices higher.

Participants also offloaded their long bets in futures and options (F&O) segment instead of carrying them forward to the next series for July, brokers said.

The Sensex, which resumed lower at 35,207.19, continued its slide to crack the 35,000-mark and touched a low of 34,937.15 as selling intensified.

However, it recovered marginally on value-buying and covering-up of short positions to end at 35,037.64 — down 179.47 points, or 0.51 per cent.

The gauge had lost 272.93 points in the previous session.

The broader NSE Nifty, after cracking the 10,600-mark, ended 82.30 points, or 0.77 per cent, lower at 10,589.10.

Meanwhile, foreign portfolio investors (FPIs) bought shares worth Rs 67.44 crore on net basis, while domestic institutional investors (DIIs) also bought equities to the tune of Rs 84.31 crore yesterday, provisional data showed.

“Weak global cues and rising oil price continued to impact domestic market sentiment while rupee declined to all-time low amid concern on inflation and current account deficit.

“The mid and small-cap continued to underperform amid tensions in global trade while short-term investors are using every opportunity to book profits due to F&O expiry. Any intervention from RBI to contain the volatility in rupee, and progressing monsoon will provide some respite to domestic market in the near term,” said Vinod Nair, Head of Research, Geojit Financial Services.

ICICI Bank remained the worst performer in the Sensex pack, plunging 2.78 per cent, while Tata Motors lost 2.69 per cent.

Other laggards included Coal India 2.23 per cent, RIL 2.13 per cent, SBI 1.83 per cent, Bajaj Auto 1.82 per cent, Maruti Suzuki 1.70 per cent, Power Grid 1.70 per cent, Yes Bank 1.52 per cent, HDFC Ltd 1.47 per cent, ONGC 1.34 per cent, Hero MotoCorp 1.01 per cent and Sun Pharma 1 per cent.

NTPC was the top performer, spurting 1.79 per cent, followed by M&M at 1.78 per cent.

Infosys and Wipro rose up to 1.01 per cent as the weak rupee tempted buyers to accumulate shares of software exporters. However, TCS dipped 0.67 per cent.

Other gainers were Bharti Airtel 1.64 per cent, Kotak Bank 1.01 per cent, HDFC Bank 1.01 per cent, Tata Steel 0.88 per cent and Vedanta 0.11 per cent.

Sector-wise, the BSE oil and gas index shed 2.51 per cent, followed by consumer durables (2.40 per cent), realty (2.07 per cent), PSU (1.70 per cent), infrastructure (1.61 per cent), healthcare (1.13 per cent), auto (0.77 per cent), FMCG (0.75 per cent), power (0.72 per cent) and banking (0.62 per cent).

In the broader markets, the mid-cap index fell 1.62 per cent and the small-cap gauge shed 1.50 per cent.

Top oil marketing companies lost further ground, led by HPCL 5.56 per cent, BPCL 4.54 per cent and IOC 1.28 per cent.

Brent crude was trading 0.41 per cent higher at USD 77.94 a barrel while WTI oil was up 0.14 per cent at USD 72.86 in Asian trade.

In Asia, Shanghai Composite Index fell 0.93 per cent and Japan’s Nikkei shed 0.01 per cent, while Hong Kong’s Hang Seng rose 0.50 per cent.

European shares too were trading weak in late morning deals, with Frankfurt’s DAX falling 0.72 per cent and Paris CAC declining 0.36 per cent. London’s FTSE was also quoting 0.16 per cent lower.