Greeks say 'No': Sensex falls 300 points but experts confident about India's resilience

Retreating sharply in the first few minutes of the opening bell, the benchmark Sensex plunged more than 300 points in early trade Monday in tune with the negative sentiment in other Asian markets. Greece public’s decision to cast a majority of ’no’ vote defying its creditors’ condition to undertake massive spending cuts for want of more financial packages raises fears that a ‘contagion’ effect could spread to other debt-laden European countries, which may further worsen financial market condition going ahead, said dealers. At 10am, the 30-share BSE S&P Sensex was at 27,908.18, down 184.61 or 0.7 percent from previous close. The index had earlier slipped to a low of 27,774.80, down 315 points. The broader 50-share CNX Nifty was at 8,433.60, down 51.30 points, or 0.6 percent. [caption id=“attachment_2328630” align=“alignleft” width=“380”]  Reuters[/caption] Among other Asian indices, Japan’s Nikkei was down 2 percent at 20,129.26 and China’s Hang Seng had dropped 3.3 percent to 25,212.40. In the domestic market, breadth of the market was weak with 1,019 stocks declining against 758 advances on BSE. Speaking to CNBC TV18, Samir Arora of Helios Capital said he does not think Greece referendum will materially impact Indian trades. Eminent economist with Citi Willeum H Buiter said, the ‘No’ vote of Greek referendum clearly shows democarcy has over-ruled finance. He warns that the recovery seen in Europe will slip once again impacting global markets including India. However, Dr Buiter said India remains isolated from a direct impact of Greece outcome because of “excellent monetary policy adopted by the country.” Investors trimmed their position in several banking, metal and consumer durable shares after most of these sectors had defied the recent lacklustre trend in the market. In the banking space, shares of ICICI Bank declined 2.2 percent to Rs 307.40, SBI lost 1.7 percent to Rs 264.20, Axis Bank fell 1.3 percent to Rs 578.45 and Bank of Baroda was down 1.1 percent at Rs 148.95. Metal shares, too, exhibited weakness on worries the Greece decision to reject European creditors’ demand could spiral into a short-term liquidity crisis and may hurt demand in Europe. Shares of Vedanta Ltd shed 3.4 percent to Rs 164.80, NMDC declined 2.7 percent to Rs 114.50, Jindal Steel lost 2.3 percent to Rs 82.65, Tata Steel eased 1.8 percent at Rs 295.55 and Hindalco was down 1.7 percent at Rs 108.60.