Mumbai : The 30-share index fell by more than 600 points on Monday morning, but by mid-day looked to touch the 26,000-mark once again.
The BSE Sensex on Monday fell more than 608.4 points from 26,265.24, after the Bharatiya Janata Party faced a drubbing in the Bihar elections on Sunday. Stocks fell amid fears that opposition parties would now block business reforms that are part of the BJP’s agenda. The broad-based Nifty too dropped by nearly 200 points to below the 7,800 level. However, both indices recovered partially by the afternoon, with the Sensex hitting 25,961.81 and Nifty showing 7865.40 at 12.57 pm.
The stock market slump hit the Rupee as well, as it fell to a one-month low of 66.49 against the Dollar. At 12.57 pm, it had recovered slightly at 66.39. However, analysts said Monday’s fall was likely a knee-jerk reaction and might not have serious long-term impacts. The slump could follow a phase of recovery and consolidation over the week, which will be cut short by holidays for Diwali. Traders said other factors could affect the markets more than Bihar, especially the likelihood of an interest rate cut by the United States next month, and the Indian government’s ability to continue its drive to ease business,
Bureau Report
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