Global tremors shake Dalal Street

MUMBAI: The equity markets extended their fall for the third consecutive day as increasing unrest in Iraq and geo-political tensions in Ukraine triggered widespread sell-off in riskier assets like equities across the globe.  

Mirroring a weak trend in overseas equities, the Sensex slipped 259.87 points or 1.02 per cent to end the trading session at 25,329.14. On the other hand, the NSE Nifty fell below its psychological 7,600 level to end the day at 7,568.55, down 80.70 points or 1.06 per cent as foreign portfolio investors offloaded shares worth Rs 503.74 crore. Experts said that the weakness in rupee against the US dollar and a rise in global crude oil prices following the crisis in Iraq and Ukraine renewed concerns about India’s CAD.

Elsewhere in Asia, Japanese Nikkei posted its biggest fall in five months plunging 2.98 per cent while South Korea’s Kospi  and Singapore’s Straits Times index fell 1.14 per cent and 0.76 per cent respectively.  

“While there was a growing unease over the crisis in Ukraine, the US authorising targeted air strikes on Iraq was the latest trigger. Moreover, the Indian markets are not insulated from the sell-off in global markets,” noted Sanjeev Zarbade, VP, research, private client group, Kotak Securities.

The broader markets also remained extremely weak with 2,118 stocks traded on the BSE ending the day lower as compared to 800 stocks that advanced. India’s VIX, which measures investors expectation about the near term volatility climbed 3.40 per cent on the NSE. “The dearth of positive domestic news has made Indian markets more prone to global events. But, given the fact that India Inc has improved its performance during the quarter ended June 2014, there is a possibility of a re-rating of Indian markets,” said Vinod Nair, head of fundamental research at Geojit BNP Paribas Financial Services.