Sensex tanks 604 pts, Nifty tad below 8100; Tata Motors down 8%
Fri Jun 24 2016
Rajesh Sharma (2003 articles)

Sensex tanks 604 pts, Nifty tad below 8100; Tata Motors down 8%

The Sensex recouped 500 points loss in last couple of hours of trade, especially after recovery in Europe but still ended sharply lower after the UK voted to leave European Union.

The index fell 604.51 points or 2.24 percent to 26397.71 and the Nifty slipped 181.85 points or 2.20 percent to 8088.60.

About 1823 shares declined against 709 advancing shares on BSE.

Tata Motors cracked 8 percent and Tata Steel fell 6 percent as both companies have huge exposure to Europe.

Reserve Bank Governor Raghuram Rajan today promised to provide liquidity and correct any disorderly market behaviour following UK’s vote to walk out of the European Union, saying that after initial investor worries over Brexit, funds should return to India.

He said he was concerned about currency intervention by nations to create a competitive advantage and asked Central banks around the world not to cause currency devaluations.

RBI, he said, is watching all markets both internationally and domestically and “will provide domestic or foreign liquidity in appropriate amounts”.

As of now, Rajan said in a concall from Basel, all the markets seem to be working and “if there are disruptions in the markets and liquidity is not available from certain quarters, we are fully ready to provide whatever liquidity is needed… Both dollar liquidity as well as rupee liquidity”.

Switzerland’s central bank said today it had “intervened” in the foreign exchange market to stabilise the Swiss franc, considered a safe haven currency, following the so-called Brexit vote.

“Following the United Kingdom’s vote to leave the European Union, the Swiss franc came under upward pressure,” the banks said in a statement, adding that it had “intervened in the foreign exchange market to stabilise the situation and will remain active in that market.”

As the result of the vote became clear, the Swiss franc strengthened considerably against the European single currency.

The Sensex recovered nearly half of its losses in last hour of trade, down 578.72 points or 2.14 percent to at 26423.50.

The Nifty declined 174.85 points or 2.11 percent to 8095.60. About three shares declined for every share advancing on Bombay Stock Exchange.

Rajesh Sharma

Rajesh Sharma

Rajesh Sharma is Correspondent for Stock Market of South East Asia based in Mumbai. He has been covering Asian markets for more than 5 years.