India’s Sensex Tumbles Most Since June as Global Selloff Spreads

Updated on
  • Tata Steel top loser on Sensex; State Bank, Axis also drop
  • Global stocks slide on central bank angst after U.S. slumps

Indian stocks declined the most in almost three months amid a global selloff and concern inflows to emerging markets will be curtailed if the U.S. raised interest rates. Lenders and material producers led the retreat.

The S&P BSE Sensex has retreated 2.4 percent after reaching an 18-month high last week as foreign investors pumped in $6.4 billion into local stocks this year. Shares in Europe and Asia dropped the most since the aftermath of the U.K. Brexit vote in June, and U.S. stock-index futures fell as concern spread that central banks are preparing to wean markets off unprecedented stimulus.

“There is a realization that the only thing holding up asset prices is the central bank induced asset inflation,” said Shankar Char, a senior vice president at Antique Stock Broking Ltd. in Mumbai. “We could see some of the over-bought sectors like autos and private banks taking quite a beating."

Lael Brainard, a member of the U.S. Federal Reserve’s board of governors, speaks Monday in Chicago, days after Fed Bank of Boston President Eric Rosengren said the economy could overheat. European Central Bank President Mario Draghi last week played down the prospect of further stimulus and the Bank of Japan is set to unveil the results of a comprehensive policy review at its Sept. 20-21 meeting.

IndexChangeMost Since
Sensex-1.5%June 24
Nifty-1.7%June 24
S&P BSE MidCap-3%Feb. 11
S&P BSE SmallCap-2.4%Feb. 11
S&P BSE Bankex-2.4%June 24
S&P BSE India Auto index-2.6%June 24
  • Tata Steel Ltd. was the top loser on the Sensex. The company said after market hours its first quarter loss widened.
  • State Bank of India and Axis Bank Ltd. were the top losers among lenders.
  • Yes Bank Ltd. plunged 5.6 percent, extending a four-day loss to 16 percent. 
  • Ashok Leyland Ltd. slid 4.4 percent, while Tata Motors Ltd. lost 3.5 percent.
  • Reliance Defence & Engineering Ltd. sank 15 percent after reporting a loss in the first quarter. 
  • Housing Development & Infrastructure Ltd. plunged 11 percent after its first-quarter profit fell 30 percent from a year earlier.

The Sensex is valued at 16.3 times projected 12-month profits compared with 12.2 times for the MSCI Emerging Markets Index. The Indian markets are closed on Tuesday for a public holiday.