An evening walk down Dalal Street
The S&P BSE Sensex plunged over 200 points on Monday weighed down by worries over a worsening trade dispute between the United States and other major economies. The Nifty50 failed to hold on to crucial support placed at 10,770-10,800.
The Wall Street Journal said U.S. President Donald Trump planned to bar many Chinese companies from investing in U.S. technology firms and block additional technology exports to China, said a Reuters report.
A senior European Commission official said on Saturday that the European Union would respond to any U.S. move to raise tariffs on cars made in the bloc, it said. Investors and traders are worried that threats of higher U.S. tariffs and retaliatory measures could derail a rare period of synchronised global growth.
Additionally, the US Treasury Department is planning to heighten scrutiny of Chinese investments in sensitive US industries under an emergency law, putting Washington’s trade war with Beijing on a potentially irreversible course, said a Bloomberg report.
"Sentiment across Asia was negative after the US Treasury department announced its decision to scrutinize Chinese investments in sensitive US industries concerned with economic and national security. This has heightened global tensions as the two powers play a game of one up-manship, pressurising markets across the globe," Abhijeet Dey, Senior Fund Manager-Equities, BNP Paribas Mutual Fund told Moneycontrol.
"Additionally, the India VIX was up by 4 percent, indicating an increase in volatility in the markets. Barring the IT index, all other sectoral indices on the National Stock Exchange, closed the day with losses," he said.
The Nifty50 ends the first session of the expiry week on a weak note led by losses in ICICI Bank, Tata Motors, and L&T. The market breadth was firmly in favour of declines with advance-decline ratio placed at 1:3.
The S&P BSE Sensex closed 219 points lower or 0.6 percent while the Nifty50 ended 59 points down at 10,762.
Sectorally, the S&P BSE IT index closed 0.85 percent higher while most of the other sectors closed in red.
On the losing front, the S&P BSE PSU Index slipped 1.7 percent, followed by the S&P BSE oil & gas index which was down 1.5 percent, and the S&P BSE Auto index ended 1.5 percent lower.
The S&P BSE Midcap index closed 0.8 percent down while the S&P BSE Smallcap index ended 0.89 percent lower.
Top Sensex losers include companies like Tata Motors (down 5.9 percent), ICICI Bank (down 3.7 percent), Coal India (down 2.2 percent), and L&T (down 2.05 percent).
Top Sensex gainers include companies like Infosys (up 2 percent), Vedanta (up 0.7 percent), Kotak Bank (up 0.7 percent), and IndusInd Bank (up 0.65 percent).