Sensex tanks over 418 points amid Centre's Jammu and Kashmir move

Mumbai: Equity benchmark Sensex on Monday crashed over 418 points to slip below the 36,700-level, a near five-month low, as massive global sell-offs rattled investors' sentiment. Monday saw Centre’s big policy moves like bifurication of  Jammu and Kashmir and proposal of scrapping of Articles 370 and 35 A.

Likewise, the NSE gauge Nifty dived nearly 135 points to close at 10,862.60. Both benchmark indices -- Sensex and Nifty -- saw an intense volatility throughout the session due to multiple headwinds like escalation in US-China trade war, weak corporate earnings, rupee downfall and political tensions in Jammu and Kashmir.

After cracking over 700 points in day trade, the 30-share index pared losses to close at 36,699.84, still down by 418.38 points, or 1.13 per cent. It hit a low of 36,416.79 and a high of 36,844.05. The 50-share Nifty plunged by 134.75 points or 1.23 per cent to close at 10,862.60 points as 38 of its constituents declined.

Among the top losers in the Sensex pack were: Yes Bank (8.15 per cent), Tata Motors (5.25 per cent), PowerGrid (4.42 per cent), RIL (3.48 per cent) and Kotak Bank (3.13 per cent).

On the other hand, Bharti Airtel, TCS, Tech Mahindra, HDFC and Bajaj Auto emerged as top gainers. Sectorally, except IT other indices ended in the red led by energy (down 2.7 per cent) followed by metal, bank, auto, FMCG, infra and pharma. BSE Smallcap and Midcap index fell over 1 per cent.

"Multiple headwinds led to market volatility for the day. Concerns of political crisis developing in J&K and no further cues on exclusion of surcharge to FPI's added to volatility in the market. Selling was broad based despite late recovery witnessed in auto and banks while IT held on with gains due to weakening rupee. Consolidation may extend given the headwinds in global trade negotiations and risk aversion strategy by FPIs," said Vinod Nair, Head of Research, Geojit Financial Services Ltd.

The government on Monday abolished Article 370 that gave special status to Jammu and Kashmir and moved a separate bill to bifurcate the state into two separate union territories of Jammu and Kashmir, and Ladakh, amid massive opposition uproar in Rajya Sabha.

The rupee declined sharply by 90 paise to 70.50 in afternoon trade following jitters in the global currency markets.

The Chinese yuan slipped to 7.03 level against the US dollar, which investors consider as a key threshold, amid reports that Beijing was devaluing its currency to support exporters, and neutralise US President Donald Trump's decision to impose fresh 10 per cent tariffs on USD 300 billion in Chinese goods.

In Asian markets, Shanghai Composite Index, Hang Seng, Nikkei and Kospi declined on Monday, following intensifying trade war between the US and China and a sharp fall in yuan. The global oil benchmark Brent crude futures were trading 0.74 per cent lower at 61.43 per barrel.