Sensex pares losses after falling over 700 points

A benchmark index of Indian equities markets pared intra-day losses marginally after falling over 700 points in the mid-day session Friday following a record erosion in the rupee's value and global cues.

All the sectoral indices of the S&P Bombay Stock Exchange (BSE) were, however, trading in red.

The markets tumbled after the Indian rupee hit another record low, slipping below the psychological resistance level of 62 against the dollar for the first time. This led to a fall of over 700 points.

The huge selling pressure in the stock markets was created by the high demands for the US currency.

Recent industrial and employment data from the US and some major European economies like France and Germany has shown significant improvement, making these markets more attractive than India.

The creation of more jobs in the US may translate into an early end to the US stimulus programme, which earlier led the US Federal Reserve to end its bond-buying programme.

The partially convertible rupee slipped to a new record low of 62.03 against the dollar at inter-bank foreign exchange market here, surpassing its previous record low of 61.80 of Aug 6.

The rupee was quoted at 61.63 at 1.00 p.m. (India time) against the Wednesday close at 61.43.

Stocks of banks, consumer durables, oil and gas, capital goods, metal, automobile, public sector undertakings (PSU) and fast moving consumer goods (FMCG) saw heavy selling.

The 30-scrip sensitive index (Sensex) of the S&P BSE, which opened at 19,297.11 points, was trading at 18,718.22 points at 2.30 p.m., down 649.37 points or 3.35 percent from Wednesday's close at 19,367.59 points.

The markets were closed Thursday -- India's Independence Day.

On Friday, Sensex touched a high of 19,310.95 points and a low of 18,621.39 in afternoon trade.

The S&P BSE Bank index index tanked 547.59 points, consumer durables index fell 488.36 points, oil and gas index fell 376.32 points, capital goods index dipped 319.14 points and metal index went down 316.83 points.

Other major losers included, automobile index which dropped 214.32 points, PSU index slid 209.05 points and FMCG index plunged 179.39 points.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) was trading at 202.60 points or 3.53 percent down at 5,539.70 points.