MUMBAI (TIP): For the fourth day on the trot, turbulences in the Chinese market sent global investors, including those on Dalal Street, scurry for cover. On Thursday morning as the CSI 300 index in Shanghai tanked 7% and the authorities there halted trading for the day, in early trade the Sensex lost over 400 points and was close to breaking below the psychologically important 25,000 mark. This was the second 7% fall in the benchmark index for the Chinese stock market this week, which was on the back of signs of further economic weakness in the world’s second largest economy.
In India, the Sensex has lost over 1,000 points since its New Year day closing at 26,161.
On Thursday, the slide in the domestic market was led by ONGC, Tata Motors, Maruti and Tata Steel, each falling over 2.5%. Of the 30 Sensex stocks, only five were trading above the red line. Dealers, however, assured that the onus of the current market weakness can’t be passed on to ant domestic factors and is attributed only to factors external to India.
At 11am, Sensex was down 332 points (1.3%) at 25,075 while Nifty on NSE was down 107 points (1.4%) at 7,634. Around Asia, Nikkei in Japan was down 2.2% while Hang Seng in Hong Kong was down 2.4%. The recent crashes in global markets are also because of Chinese government decision to let Yuan, its currency that the government manages vigorously, weaken, indicating dim chances of a quick recovery of the economy that grew in double digits for most of the last 25 years.