GDP, weak Chinese data weigh: Sensex falls 300 pts, slips below 26000

Maintaining the downward trend after Monday’s fall, key domestic share benchmark indices witnessed rapid slump in early trade today with the Sensex plunging almost 300 points to slip below the 26,000 mark as lower-than-estimated first-quarter GDP numbers and dismal economic readings in China prompted investors to follow global markets. While weak global markets, too, weighed on sentiment, sluggish April-June quarter growth numbers at 7 percent that was released yesterday post market hours also precipitated the fall. The 7 percent growth in the first quarter was below the median estimates of economists polled by Reuters, which had projected growth at 7.4 percent. At 10 am, the 30-share BSE S&P Sensex, after slipping to a low of 25,984.28, was quoted at 26,135.01, down 148.08 points, or 0.6 percent from the previous close. The broader 50-share CNX Nifty was at 7,925.30, down 46 points, or 0.6 percent. [caption id=“attachment_2415832” align=“alignleft” width=“380”]  Reuters[/caption] Market breadth was weak, with 1,080 stocks declining against 536 advances on the BSE. While questions are being raised about the rapidly deteriorating Chinese economic health, the new set of numbers further validates the pain in the dragon nation’s growth prospects. Fresh Chinese manufacturing data showed its official Purchasing Managers’ Index (PMI) fell to 49.7 in August from the previous month’s reading of 50.0, the weakest showing in three years. Separately, the private Caixin/ Markit China Manufacturing Purchasing Managers’ Index (PMI) showed a final reading of 47.3 in August, the lowest since March 2009, a Reuters report showed. This led to a fall in Chinese equity markets with the Shanghai Composite Index dropping 1.1 percent and the Hang Seng falling 0.5 percent in early trades. Japan’s Nikkei also witnessed steep fall, declining nearly 2 percent so far. Among the laggards in the Sensex pack, shares of HDFC fell 2.2 percent to Rs 1,162.35, HDFC Bank 2 percent to Rs 1,007.50, Bharti Airtel 1.5 percent to Rs 349.20, SBI 1.5 percent to Rs 243.45, Axis Bank 1.4 percent to Rs 499.60 and L&T 1.2 percent to Rs 1,585.05.