Closing Bell: Bears Have A Field Day On D-Street; Sensex Slips Over 1000 Pts, PSU Banks, Metals Drag

Market closing: Benchmark indices Sensex and Nifty closed sharply lower on Tuesday in a decline the market watchers attributed to the trade deficit and pre-FOMC jitters. While Nifty closed at 24336, down 332.25 points or 1.35 per cent from the previous day's close, the 30-scrip BSE Sensex crashed over 1000 points to close the day at 80,708.

Stock Market Crash Today: ITC Shines As Sole Gainer In 30-Pack BSE Sensex

While ITC remained the only top gainer on the backdrop of the company announcing the record date for the demerger of its hotels business, the rest of the 30-pack Sensex dragged the index down. Bharti Airtel was the biggest loser with a 3.02 per cent decline, followed by IndusInd Bank, JSW Steel and TCS among others.

Metals, Auto, Energy, and PSU Banks dropped the most, while Nifty IT, Realty and Pharma closed marginally lower. Market watchers attributed the sharp decline in Indian equities to the trade deficit and jitters ahead of the Federal Open Market Committee (FOMC) meeting this week.

Stock Market Crash Today: ‘Economic data and the lack of a counter-cyclical boost a disappointment’ - Expert

“We expect Indian markets to end on a high but the economic data and the lack of a counter-cyclical boost on the fiscal or monetary fronts has been a disappointment. India's trade deficit came at a record high of USD37.8bn in November from USD27.1 in October, caused by weak exports," said Ajay Bagga, Market Expert - ANI cited.

He further added "The RBI 's using up of over USD 50 billion of FX reserves to protect the Indian rupee is unfathomable in this scenario. However, the RBI should have let the Indian rupee depreciate instead of doing the twin damage of artificially inflating the rupee and sucking out domestic liquidity in a busy credit season. Monetary policy needed to fire with a rate cut and liquidity injection and a rupee depreciation to make exports more competitive and imports more expensive".