Indian equity benchmarks nosedived in Tuesday's fag-end trade due to weakness across all sectors. The BSE Sensex pack slumped over 900 points while the NSE barometer Nifty hit the sub-24,500 level. At 3:10 pm, the 30-pack Sensex was down 902 points or 1.11 per cent at 80,249. The NSE benchmark traded 310 points or 1.25 per cent lower at 24,471. Such was the fall in the domestic indices that around Rs 8.9 lakh crore of BSE market capitalisation (m-cap) was wiped out.
Investor wealth, as suggested by the BSE m-cap, fell Rs 8.98 lakh crore to Rs 444.66 lakh crore compared with a valuation of Rs 453.65 lakh crore recorded in the previous session. Frontline stocks such as Reliance Industries Ltd (RIL), HDFC Bank Ltd, Mahindra & Mahindra, SBI, L&T, TCS, Tata Motors, Axis Bank, Kotak Mahindra Bank and Maruti Suzuki India contributed to the fall today.
Here are the key factors behind today's market fall:
* Profit booking
"Domestic equities have witnessed profit booking post a stellar run-up in the recent past. Indication of softening of the economy in the medium- to -short-term has been weighing on investor sentiment," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities. From a longer-term perspective, the Indian market is a 'buy-on-dip' market, the market expert added.
"When market valuations are at elevated levels some triggers will cause corrections, making the valuations reasonable and in tune with long-term averages," said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
* FII selling
Heavy selling by foreign institutional investors (FIIs) broke all records in October, offloading the highest-ever shares in one month. Sustained selling by FIIs has reached Rs 88,244 crore by October 21, as per NSDL data. This record-high FII sell figure saw the countervailing action of sustained domestic institutional investor (DII) buying. FIIs offloaded Rs 2,261.83 crore of shares on a net basis in the previous session, while DIIs purchased Rs 3,225.91 crore of stocks, exchange data showed.
* Asian stocks
On the global front, most Asian markets traded lower. Japan's Nikkei was down 1.39 per cent, South Korea's Kospi index slipped 1.31 per cent. Hong Kong's Hang Seng traded almost unchanged and the Shanghai Composite index climbed 0.54 per cent.