Sensex slips below 16,000, Nifty nears 4,800
Google and Facebook have the same number of users. However, Google's net profit and revenue is 10 times that Facebook. Yet, at over $ 100bn, the stock market is giving a market value to Facebook that is only half of Google.
The BSE Sensex fell over 200 points to slip below the 16,000 mark for the second time this week. Markets came under selling pressure after negative news from Europe and the US led to a global selloff in risk assets.
The rupee fell to a new low, further adding pressure on equities. At 09.30 am, the Nifty index traded 60 points lower at 4,810.
Global stocks came under selling pressure after ratings agency Moody's downgraded 16 Spanish banks citing a weak economy and the government's reduced ability to support troubled lenders. Asian markets traded with deep cuts, with markets in South Korea (-2.65%) and Japan (-2.45%) leading the losses.
Data from the US indicated that manufacturing contracted in the mid-Atlantic region for the first time in eight months. The Dow Jones index fell 156 points to 12,442.
All groups of stocks traded lower on the BSE. Public sector lender SBI (0.38%) was the top Nifty gainer. The stock traded higher ahead of reporting its fourth quarter earnings today. State run oil marketing firm BPCL (0.18%) was the other gainer. The counter benefitted from falling crude prices.
48 of the 50 stocks traded lower on the Nifty. Auto stocks like Maruti Suzuki (-2.7%) and Tata Motors (-2.6%) were the laggards. Mining stocks like Sterlite (-2.54%) and Sesa Goa (-2.52%) fell on weak commodity prices.
The market breadth was extremely weak with only 12% stocks managing to advance on the broader BSE 500 index.
Analysts said the bounce back witnessed yesterday proved short lived and markets are headed lower. "The fact that the bounce did not last for even two sessions, indicates medium term targets around 4,000-4,200," independent analyst Sarvendra Srivastava said.
(With inputs from agencies)