Rail stocks derail; Sensex crashes 518 pts
Slipping from record highs, the Sensex today plunged 518 points and the Nifty tanked 164 points in their worst drop in 10 months
Mumbai: Slipping from record highs, the Sensex today plunged 518 points and the Nifty tanked 164 points in their worst drop in 10 months on profit booking as investors said Narendra Modi-led NDA government’s first Railway budget carried no big-bang announcement.
Both indices fell about two per cent with the BSE Sensex ending at 25,582.11 and the NSE Nifty settling at 7,623.20.
Railway Minister Sadananda Gowda today tabled his maiden Railway Budget in Lok Sabha where he proposed to attract private domestic and FDI in infrastructure projects and pursuing private-public partnership to boost the finances of the cash-strapped railways.
“…the budget was about operationalising legacy projects which were languishing as no focus was there on execution of these projects. It was this absence of big bang announcement that led to a sharp correction in equity markets,” said Ritesh Jain, Chief Investment Officer, Tata Asset Management Ltd.
Shares of railway related companies that were trading up at initial stages, dropped upto 20 per cent on profit-selling. Prominent losers included shares of Texmaco Rail, Titagarh Wagons, Kalindee Rail Nirman and Container Corp.
The BSE 30-share barometer resumed better but later it turned negative and closed at 25,582.11, a fall of 517.97 points or 1.98 per cent. Intra-day, it made a new record high of 26,190.44.
Among the Sensex constituents today, 28 ended lower. BHEL (8.16 pc), NTPC (5.36 pc), Tata Power (5.04 pc) and Coal India (4.96 pc) led the laggards in bluechips. The 50-issue Nifty fell 163.95 points, or 2.11 per cent, to 7,623.20 after hitting new peak of 7,808.85 intra-day.
Both the indices registered their biggest fall in absolute term in ten months as Sensex had plunged by 651.47 points and the Nifty by 209.30 points on September 3, 2013.
Selling was seen across-the-board as all 12 BSE sectoral indices closed in the red. Second-tier stocks witnessed heavy selling from retail investors and their indices underperformed the Sensex. Realty, power, capital goods, consumer durable, metal, refinery and banking shares took the lead in downslide.
Mixed Asian cues and weak European opening also weighed on the market sentiment.