NEW DELHI: US-China trade woes returned to haunt global markets and the domestic indices were no exception as Sensex and Nifty ended lower by 1 per cent each.
US President Donald Trump caught everyone by surprise, as he reignited trade tensions between the world's two biggest economies by vowing to hike tariffs on Chinese goods by this week. The effects were felt all over the globe with Chinese markets declining to their three-year low as investors fled towards safer assets.
Indian market, however, fared better than its global peers. BSE Sensex shed 363 points or 0.93 per cent to settle at 38,600. Its NSE counterpart Nifty ended at 11,598, down 114 points or 0.97 per cent.
Meanwhile, uncertainty also gripped markets as the fifth phase of the polling kicked off today.
The rupee too declined tracking weakness in stocks and shed nearly 24 paise against the greenback.
On the BSE, for every one stock that gained, two declined.
Market at a glance
Bank and financial stocks were major drags on Sensex with HDFC twins and RIL alone accounting for more than half of the index's decline.
As many as 25 of 30 Sensex stocks ended in the red with YES Bank as the worst performer. Shares of the private sector lender took a beating after rating agency Icra downgraded its debt instruments and guided for a negative outlook. The scrip ended 5.30 per cent lower at Rs 166.30.
Shares of ITC and TCS were the biggest gainers on Sensex, rising over 1 per cent each.
BSE Midcap and BSE Smallcap declined in line with benchmark Sensex, falling 0.79 per cent and 0.85 per cent each.
Barring telecom and oil & gas packs, all other sectors ended on a weak note. Consumer durable and metals were the worst performing sectors on BSE, slipping over 2 per cent.
Among NSE's sectoral indices, only IT ended in the green.
India VIX spiked over 10 per cent.
Factors that weighed on Dalal Street:
Trade war jitters
Global markets were deep in the red after US President Donald Trump unexpectedly ratcheted up trade tensions between the world's largest economies by vowing to hike tariffs on Chinese goods by this week, prompting investors to flee riskier bets. The pan-European STOXX 600 index had shed 1.4 per cent, its steepest fall in six weeks. The bluechip CSI300 index and the Shanghai Composite Index both tumbled more than 5 percent, posting their steepest single-day drop since February 2016.
Fifth phase of elections
Adding to the nervousness was the kickstart of the fifth phase of the general election. Voting took place in 51 Lok Sabha constituencies from Seven states. In this phase, nearly nine crore voters will decide the fate of 674 candidates, including political bigwigs Rajnath Singh, Sonia Gandhi, Rahul Gandhi and Smriti Irani. After four phases of elections, the voting percentage is 67 per cent compared with 67.6 per cent in 2014.
The domestic currency shed 24 paise against the US doRead More – Source