Investor wealth worth Rs 1.5 lakh cr eroded as Sensex tanks 526 pts

The BSE Sensex saw its biggest fall in nearly two years, plunging over 526 points, due to massive selling.

Investor wealth worth Rs 1.5 lakh crore was eroded on Thursday on worries that capital inflows may dry up if US Federal Reserve sticks to its plan of slowing down monetary stimulus later this year.

The stock markets were also under heavy pressure after the Indian rupee touched a life-time low of 59.93 against the US dollar.

The 30-share index of the Bombay Stock Exchange (BSE) tumbled 526.41 points, or 2.74 per cent, to 18,719.29, recording its biggest single-day fall since September 2011. Across market, over 1,650 stocks fell and just 650 rose.

The broad-based National Stock Exchange index Nifty dipped below 5,700-level by losing 166.35, or 2.86 per cent to close at 5,655.90. Also, SX40, the flagship index of MCX-SX, closed 308.22 points, or 2.70 per cent, down at 11,118.85.

US Fed Chairman Ben Bernanke on Wednesday night ended weeks of speculation saying the Federal Reserve will likely slow its bond-buying programme later this year and end it next year because the US economy is showing strong signs of recovery.

Traders at Dalal Street said a pullback in Fed's $85 billion-a-month programme is being interpreted as a move that will hit inflows to emerging markets like India.

The plunge in domestic markets was led by stocks of realty, metal, banks and power shares with 28 scrips of Sensex ending down. Only, Wipro and Sun Pharma rose.

Heavyweight stocks like Reliance Industries dropped 3.84 per cent and Infosys lost 2.92 per cent. Jindal Steel and Power sank 9.62 per cent on major sell-off by participants.

Among others, BHEL, Dr Reddy's Lab, GAIL India, HDFC Ltd, HDFC Bank, ICICI Bank, SBI, Hindalco, Sterlite Industries, Larsen and Toubro, Bharti Airtel, Mahindra and Mahindra, Maruti Suzuki Tata Motors fell sharply.

Brokers said sentiments turned extremely bearish after Indian currency rupee slumped to all-time low of 59.93 to a dollar, tracking weak trend in the other global currencies.

In the Asian region, Hong Kong's Hang Seng index fell 2.88 per cent and Japan's Nikkei shed 1.74 per cent on Thursday.

With inputs from PTI