Mumbai, (IANS) After crashing 1,688 points, or 6.12 per cent, in early trade on Wednesday, a key Indian equity index, the 30-share sensitive index (Sensex) of the BSE, regained a large part of the losses to trade around 383 points, or 1.39 per cent, lower over the previous close.
Following global cues, as also domestic developments, key Indian indices had reacted adversely to the government’s decision the previous evening to demonetise Rs 500 and Rs 1,000 currency notes, as also on clear lead Republican candidate Donald Trump established in the US presidential election.
The 30-share Sensex opened as much as 1,339.76 points, or 4.86 per cent lower on Wednesday, at 26,251.38 points, against the previous close at 27,591.14 points. It then drifted 350 points further immediately after. But gradually, a large part of the losses were recouped.
By the time Democratic Hillary Clinton conceded defeat and Trump gave his victory speech, the index had significantly risen from the lows, and was quoting at 27,207.92 points, down 383.22 points, or 1.39 per cent.
Initially, all the 30 shares that go into the Sensex basket were quoting in the red. But upon the recovery, four stocks were in the green, three of them in the pharma space — Dr. Reddy’s, Sun Pharma and Lupin. The State Bank of India was also in the positive territory.
“The initial lead of Trump in US elections sent markets into a tizzy. Now since the lead has been materialised in him winning the election, the market is adjusting itself to changed economics and decisive ways the policies will be implemented,” said Mustafa Nadeem, CEO of Epic Research.
“Winning of Donald Trump has had a negative impact on the global markets,” Astha Jain, Senior Research Analyst, Hem Securities, told IANS.
At the National Stock Exchange, the Nifty was quoting at 8,414.35 points, down 129.20 points, or 1.51 per cent.
Jain, however, sounded positive on the demonetisation of Rs 500 and Rs 1,000 currency notes. “The announcement on Tuesday evening on demonetisation will have a good impact on the overall economy in the long run. In the short term, the impact is, however, negative,” Jain said.
“The sectors which involve cash transactions are the worst affected, mainly the real estate and IT sector.”
The situation was no different at other global markets.
At one point, the US Dow was down nearly 4 per cent, Australia’s S&P ASX/200 lost 1.2 per cent, Japan’s Nikkei was down 4.5 per cent, Hong Kong’s Hang Seng fell 2 per cent, South Korea’s Kospi was down 2.3 per cent and the Shanghai Composite fell 0.6 percent.