Mumbai: Geo-political tension on Thursday took a toll on the domestic markets. BSE Sensex plunged over 465 points, the biggest single-day fall in 3 months, as 29 of 30 stocks slumped. The markets turned panic after India carried out surgical strikes last night on terror launchpads across Line of Control (LoC).

The Army's announcement triggered all-round selling, sending the 30-share barometer into a tizzy, which went below the key 28,000-mark. It settled at 27,827.53, lower by 465.28 points, or 1.64 per cent, its biggest single-day fall since June 24 and weakest closing since August 26, when it closed at 27,782.25.

In a tweet, Economic Affairs Secretary Shaktikanta Das said decisive action against terrorism will spur growth and stability.

The 50-share NSE Nifty, which cracked below 8,600-level to hit a low of 8,558.25 during the session, managed to recover some ground and ended down 153.90 points, or 1.76 per cent, at 8,591.25.

The intra-day plunge was even higher at 573 points, but some bargain-buying at lower levels helped the index settle higher than the day's low of 27,719.92. The rupee too was caught in the crossfire, sharply down 39 paise against the US dollar, at 66.85.

The stocks went into a panic mode soon after the announcement that India conducted surgical strikes last night on terror pads across the Line of Control.

Mood turned decidedly cautious after the Army said the surgical offensive last night came on very specific and credible information about Pakistan-based terrorists being pushed into Indian territory for carrying out strikes in Jammu and Kashmir and various cities in India.

However, dynamics of the September derivatives expiry ensured the spree of liquidation of bets did not lead to a free fall. Earlier, the Sensex had hit a high of 28,475.57, in sync with a firm global trend after a surprise decision by OPEC to cut oil output for the first time in eight years to push up prices.

In a tweet, Economic Affairs Secretary Shaktikanta Das said decisive action against terrorism will spur growth and stability.

Mood turned decidedly cautious after the Army said the surgical offensive last night came on very specific and credible information about Pakistan-based terrorists being pushed into Indian territory for carrying out strikes in Jammu and Kashmir and various cities in India.

Adani Ports lost most by 5.01 per cent. Sun Pharma, ICICI Bank, GAIL, Tata Steel, Lupin, Tata Motors and SBI followed. TCS manged to close in the green, up 0.46 per cent.

“As markets got first whiff of developments across the border, panic liquidation gripped the stocks enmasse, resulting in a sell-off across the board,” said Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services.

Realty got the maximum battering, falling 6.31 per cent, followed by power (4.11 per cent), healthcare (3.26 per cent), metal (3.17 per cent), infrastructure (3.15 per cent) and consumer durables (2.84 per cent). Broader markets stumbled too, with the BSE small-cap index falling 4.02 per cent and mid-cap 3.60 per cent.

Foreign portfolio investors (FPIs) net bought shares worth Rs 73.83 crore yesterday, as per provisional data. Much of Asia and Europe traded in the positive territory.

Small- and mid-caps were the big causalities today. Now, 8,500 will be the next support level and maintain its strength.
Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services Ltd

Japan's Nikkei rose 1.39 per cent and Hong Kong's Hang Seng 0.51 per cent. Shanghai Composite ended 0.36 per cent higher. London-based FTSE index jumped 1.09 per cent, Paris CAC 30 1.36 per cent and Frankfurt's DAX 0.93 per cent in their early trade.

"Small- and mid-caps were the big causalities today. Now, 8,500 will be the next support level and maintain its strength," said Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services Ltd.

The market breadth turned negative as 2,297 stocks ended in the red, but 442 stocks finished in green while 192 ruled steady. The total turnover on BSE rose to Rs 5,428.13 crore, from Rs 2,932.59 crore during the previous trading session.

Indian Rupee Plunges to Week's Low at 66.85/USD

The Indian rupee on Thursday tumbled to its lowest level in the last one week after the army announced that it had carried out 'surgical strikes' on terror camps across the Line of Control (LoC) with Pakistan.

Indian rupee along with Indian bonds and Indian equities made a knee jerk reaction as markets digested the news of India’s surgical strikes against terrorist camps.
Anindya Banerjee, Associate V-P (Currency Derivatives) at Kotak Securities

The rupee too was caught in the crossfire, sharply down 39 paise against the US dollar, at 66.85. The Indian currency, which opened at 66.44 to a US dollar, had already depreciated in the initial hours of the day's trade in line with the weakness in Asian currencies.

The sharp fall occurred around 1pm, when the rupee depreciated to 66.95 to a US dollar. This level was last seen on September 22. However, the Indian currency bounced back marginally to 66.85 to a greenback before speculative selling dragged it lower to 66.90 at 4.10 pm.

"Indian rupee along with Indian bonds and Indian equities made a knee jerk reaction as markets digested the news of India's surgical strikes against terrorist camps," said Anindya Banerjee, Associate Vice President for Currency Derivatives with Kotak Securities.

Rupee weakened towards 66:92 from 66:40 levels. However, intervention from the central bank contained the slide. We hope the geopolitical situation is contained. Once the situation stabilises, then the rupee and bonds will be able to recover in the coming sessions.

Source: PTI/ IANS