Indian shares ended at over two-month closing low on Monday in an extremely volatile session as the rupee weakened against the US dollar amid surging crude oil prices. The double whammy was enough to spook investors to resort to selling across sectors.
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Both the benchmark indices, the BSE Sensex and the NSE Nifty50, closed the session 1.5 percent lower, while broader indices Nifty Bank and the Midcap index fell over 2 percent each.
Nifty that fell below 10,950 in the 1st half of the session, made a mild recovery to close at 10,967 with a fall of 176 points. The 30-share BSE index, Sensex fell 537 points to 36,305.
A major fall seen in the broader markets kept market breadth in favour of declines with the NSE advance-decline ratio at 1:6.
Over 80 percent of the Nifty Fall was contributed by financials, led by stocks like HDFC twins, ICICI Bank and IndusInd Bank, while IT was the bright sector with TCS hitting the record high of Rs 2,210 per share.
IT shares outperformed benefitting from the persisting weakness in the rupee against the US dollar. Crude too saw a 2 percent higher move with Brent oil prices trading above $80/bbl and Nymex above $72/bbl.
JP Morgan has forecast Brent to hit $90/bbl and Mercuria Energy sees prices moving 'north of $100/bbl' because of supply uncertainty.
In the futures market, Nifty Put option of 10,800 saw the maximum traction with an addition of 14 lakh shares in the open interest with premium surging more than 100 percent whereas Nifty Call options of 11,100, 11,000 and 11,200 saw their premiums slipping in a range of 61-79 percent.
Nifty September Futures closed with a premium of 33 points against a premium of 23 points on Friday.
Australian and Hong Kong markets were largely negative as tariffs between the U.S. and China kicked in. The ASX 200 recovered from its earlier losses but still closed 0.12 percent lower at 6,187, with the heavily weighted financial sector shedding 0.1 percent.
Commonwealth Bank of Australia slid by 0.51 percent, while AMP's stock lost 1.2 percent. Rare earths miner Lynas saw its stock make a slight recovery but still ended the trading day lower by 18.3 percent, after the company announced earlier that it was aware of media speculation surrounding a possible review of its operations in Malaysia.
In the Greater China region, Hong Kong's Hang Seng index slid further as it traded lower by 1.6 percent, with property developer Country Garden's stock still down by 6.3 percent.
The markets in Japan, South Korea and China were closed for public holidays on Monday.