Sensex, Nifty tumble to 21-months low on heavy selling

Markets continued to fall for the second consecutive week due to persistent selling from operators and investors on concerns over global economy and weak results from banks.

“Relentless selling in the stock market is coming from redemption pressures, margin calls, crude slumping to multi-year lows, depreciating rupee against dollar and disappointing earnings,” Hem Securities Director Gaurav Jain said.

Weak earnings from public and private sectors banks on account of higher provisioning for bad loans mainly affected the market sentiment, a broker said.

Putting the blame for the fall on global factors, the government sought to put a brave face saying the fall in market benchmarks this year has been just about 10 per cent as against much higher declines in other markets.

SBI reported a plunge of over 61.67 per cent in its third-quarter net profits, while number of other banks have also reported weak results on worsening bad loan scenario.

Asian markets also traded weak following US Federal Reserve Janet Yellen’s testimony which suggested that the bank is likely to continue on the gradual rate hike path.

The Sensex resumed slightly higher at 24,637.41 and moved up 24,698.85 on initial buying. But, tumbled afterwards to 22,600.39 before concluding at 21-month low of 22,986.12, showing a sharp fall of 1,630.85 points or 6.62 per cent.

The Sensex had last quoted at 22,344.04 on May 9, 2014.

The Sensex has dropped by 1,884.57 points or 7.57 per cent in two weeks.

The 50-share Nifty also tumbled by 508.15 points or 6.79 per cent to close at 21-month low at 6,980.95.

The Nifty had last quoted at 6,858.80 on May 9, 2014.

The Nifty has also lost 582.60 points or 7.70 per cent in two weeks.