Nifty hits 15-month low, ends below 5K on global turmoil
18 Aug 2011
After a few days of relative calm, Indian equity benchmarks closed with enormous cuts, with the NSE Nifty closing below 5000 for the first-time since June 2010, nearly 15-month low. It was a complete free-fall on the Dalal Street on Wednesday, dented by the fears about recovery in the European and US economies after debt crisis.
The 50-share NSE Nifty touched new 52-week intra-day low of 4,932.15, before closing down 112 points at 4,944. The 30-share BSE Sensex fell 371 points, to end at 16,469.79.
On the global front, European markets like France's CAC, Germany's DAX, Britain's FTSE were down 2-3.5%. The Dow Jones futures tumbled 173 points. Major Asian markets like Hang Seng, Shanghai and Nikkei closed down 1-1.6%.
Experts feel that one should learn to live with the pain as the bleeding is going to last long now. Stephen Roach, non-executive chairman of Morgan Stanley Asia said that Euro zone crisis is far from over and may see further adjustments in global equity markets.
Morgan Stanley has cut global GDP growth forecasts to 3.9% and 3.8% in 2011 and 2012 respectively. Roach further warned that both the US and Euro are hovering close to recession.
On home turf, corruption problems coupled with rate hike fears too spooked the markets. Roach is expecting additional 1-2% monetary tightening by RBI.