'Manic Monday' in India

'Manic Monday' in India 

Mumbai : On 26^th August 2015, another "Manic Monday" saw a key Indian equity index log its steepest ever closing fall in point-terms, spooked by a crash in Chinese bourses, unmindful of the assertions by policymakers that the turbulence was transient and the country's economy remained strong.

In this turmoil, the Indian rupee also fell to its lowest in two years at 66.74 to a dollar.

The sensitive index (Sensex) of the Bombay Stock Exchange (BSE) lost as much as 1,624.51 points, or 5.94 percent -- which was the steepest in terms of points, surpassing the previous highest closing loss of 1,408.35 points on Jan 21, 2008.

In terms of percentage, the loss of nearly 6 percent on Monday was around a half of the steepest fall of 11.13 percent in the Sensex, which was logged on May 17, 2004, data available with the Mumbai bourse showed. In fact, all these were Mondays.

The wider, 50-scrip Nifty of the National Stock Exchange (NSE) followed a similar trend to close 491 points, or 5.92 percent, down at 7,809 points. In both bourses as much as Rs.7 lakh crore ($100 billion) was wiped out in terms of marketcap.

At BSE, out of 2,835 companies that traded on Monday, 2,477 of them declined. Just 303 managed to stay afloat. In terms of Sensex, all the 30 shares that go into the bellwether's basket ended in the red.

So massive was the crash that top policymakers, led by Finance Minister Arun Jaitley and Reserve Bank of India (RBI) Governor Raghuram Rajan sought to talk the market up, by saying the the core fundamentals of the Indian economy are strong and the turmoil will tide over.

"Factors responsible for the markets fall are entirely external. There isn't a single domestic factor," said Finance Minister Arun Jaitley at a conference here. "The turbulence is transient and temporary in nature. Markets will settle down once the turbulence is over."