Yo Yo Sensex: Index gyrates 330 points in early trade amid global uncertainty

Domestic equities exhibited sharp volatility in the first hour of trade Monday, gyrating 330 points as uncertainty in global markets marked by weak US markets close Friday and mixed Asian indices in early trade prompted investors back home to offload stocks across most of the risky sectors. After opening higher and rising 185 points to touch a high of 25,387.32, the benchmark Sensex soon lost ground and shed nearly 150 points triggered by Chinese economic slowdown worries, likely US rate hike and a sharp depreciation in rupee against the dollar early today. [caption id=“attachment_2418348” align=“alignleft” width=“380”]  Reuters[/caption] The rupee declined 24 paise to 66.70 against the dollar compared with the last close of 66.46, signalling more foreign fund outflow from the domestic market. In addition to last month’s record net outflow of over Rs 17,000 crore from domestic equities, foreign institutional investors offloaded shares worth Rs 4,385 crore last week, indicating more pain for the markets in the near term. At 10.25 am, the BSE S&P Sensex was at 25,183.09, down 18.81 points, or 0.1 percent from previous close. The broader CNX Nifty was at 7,649.30, down 5.75 points, or 0.1 percent. Market breadth was weak with 1,189 stocks declining against 670 advances on BSE. Last week, domestic equities witnessed major sell-off that shaved 1,190 points off the Sensex, its biggest weekly loss in nearly four years. Despite the bearish US markets close last Friday, local investors are hoping the US Fed may delay rate hike decision, a move that could put brakes on FII outflows from domestic shares, after data showed nonfarm payrolls increased 173,000 in August, fewer than the 220,000 that economists polled by Reuters had expected. However, underlining concerns about the health of the world’s second largest economy persisted, as China revised its annual economic growth rate in 2014 to 7.3 percent from the previously released figure of 7.4 percent on Monday, a Reuters report said. Vary about the fragile global equity markets trend, local investors further cut their position in several blue-chip stocks. Shares of Coal India dropped 1.9 percent to Rs 340.25, Bharti Airtel declined 1.8 percent to Rs 343.65, Gail eased 1.6 percent to Rs 276.50, Lupin fell 1.4 percent to Rs 1,833.25 and BHEL was down 1.3 percent at Rs 204.