Sensex down as rupee falls to new low

A benchmark index of Indian equities markets Wednesday fell over one-and-a-half percent as the rupee fell to a record low of 68.02 against the dollar.

The 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE), which opened at 17,851.44 points, was trading at 17,709.50 points around 11.20 a.m., down 258.58 points or 1.44 percent from the previous day's close at 17,968.08 points.

The Sensex touched a high of 17,851.44 points and a low of 17,448.71 points during the early trade.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) lost 105.60 points or two percent at 5,181.85 points.

The partially-convertible rupee slumped to a new low of 68.02 against the dollar at the inter-bank foreign exchange market in Mumbai, surpassing the previous low of 66.25 recorded Tuesday.

The rupee later breached the 68.75 level around 10.30 a.m. The rupee had closed Tuesday at 66.25 - a depreciation of 2.36 percent from its Monday's close of 64.72 against the dollar.

The sharp volatility in the market comes a day after it tanked around 600 points, amidts heavy selling by foreign institutional investors (FIIs), showing their lack of interest in a weak Indian economy.

The markets were also concerned over the widening of the fiscal deficit as the lower house of parliament Monday passed the National Food Security Bill, whose implementation will cost nearly $20 billion.

Except for the IT and technology, entertainment and media (TECk) sectors, all other scrips were trading in the red.

Heavy selling pressure was observed in banking index (bankex), oil and gas, capital goods, public sector undertakings (PSUs) and automobile sectors.

The S&P BSE bankex plunged 301.62 points, oil and gas index was down 238.88 points followed by capital goods index which tanked 172.05 points, PSU index dropped by 156.91 points and automobile index slipped 150.82 points.

The rupee's slide against the dollar translated into a healthy buying spree in the export-oriented IT and TECk sectors, which grew 138.46 points and 34.92 points respectively.