Stock Market Crash | Sensex, Nifty plunge over 8% each; PSUs, mid and small caps bleed

India VIX rose 43.6 percent to 30

Benchmark indices Sensex and Nifty plunged more than 8 percent on June 4, the steepest decline in more than four years, as vote counts from the nation's marathon elections indicated that the incumbent Bharatiya Janata Party might be reliant on alliance partners to return to power for a third time.

This is in sharp contrast to exit polls, which predicted the BJP-led National Democratic Alliance would return to power with a thumping majority.

At 12.31 pm, the Sensex was down 5,684 points or 7.4 percent at 70,783 and the Nifty 50 was down 1,804 points or 7.8 percent at 21,459. About 215 shares advanced, 3,159 shares declined, and 52 shares remained unchanged.

PSU stocks were the biggest losers with trading in many of them being temporarily suspended after a fall of 15 percent. BEL, PFC and REC were among the big losers down between 15-20 percent.

Also Read | Nifty PSE down 14%, trading halted in key shares as trends show weaker majority for NDA

Besides these, financial services and oil and gas stocks bore the brunt of the selling fury as panicky bulls liquidated their positions.

"The steep fall is due to the results so far falling short of the exit polls which the market had discounted yesterday (June 3). If BJP doesn’t get a majority on its own there will be disappointment and this is getting reflected in the market," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Brokers said the steep fall would have triggered margin calls which in turn is adding to the selling pressure.
Fundamental View

"Today, with Lok Sabha election results pending, markets are keenly watching for a potential historic third term for PM Narendra Modi and whether the NDA will exceed 400 seats," said Prashanth Tapse, Senior VP (Research), Mehta Equities.

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Technical View

The upper range for Nifty 50 is seen at 24,130 and lower range at 20,930, said Anand James, Chief Market Strategist, Geojit Financial Services. James said that Nifty 50 need to close below 22,954-22,841 for bears to dominate.

Key Nifty gainers

HUL, Hero MotoCorp, Britannia, Divis Labs, Sun Pharma

Key Nifty losers

Adani Ports, Adani Enterprises, Coal India, NTPC, SBI

Key Sensex gainers

HUL, Sun Pharma, Titan Company, Nestle, Asian Paints

Key Sensex losers

NTPC, SBI, Power Grid Corp, L&T, Axis Bank

Stock moves

Adani Ports and Special Economic Zone (ASPEZ): Shares slumped 8 percent on account of profit booking. The correction comes even as Morgan Stanley put an 'overweight' call on the stock with a target price of Rs 1,517 per share.

Defense: Shares of defense-related companies slumped by up to 9 percent as investors rushed to take home partial profits after the bull run seen in these counters in recent times.

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