Nifty ends below 8000; Sensex tanks for 6th day, down 385 pts

Moneycontrol Bureau3:30 pm Market Update: Equity benchmarks remained under pressure as the Sensex was down 385.10 points or 1.47 percent at 25765.14 and the Nifty down 145 points or 1.80 percent at 7929.10, erasing all 2016 gains.The Sensex has seen the biggest losing streak since March 2015.About five shares declined for every share rising on the BSE.3:15 pm Interview: Bankers have maintained a positive stance after the roll-out of the demonetisation scheme. Rakesh Sharma, MD & CEO of Canara Bank concurs with the optimism and says that though the bank faced initial hiccups in having their deposits placed in RBI currency chests, the task force formed to manage the chaotic situation has made life easier.He also said borrowing is not a problem for the bank. According to him, the huge amount of deposits received via demonetisation is going to help the bank in recovering non-performing assets (NPAs). Sharma also sees no stress in the book currently and remains positive on the impact of cash cleanup on banks. He said the bank received Rs 32,000 crore deposits since November 10 and the current and savings account ratio (CASA) has gone up by 30 percent. Recovery in loan accounts is at Rs 4,000 crore. 3:10 pm Market update: The Sensex is down 410.48 points at 25739.76, and the Nifty is down 151.35 points at 7922.75. About 386 shares have advanced, 2207 shares declined, and 141 shares are unchanged.2:28 pm Demonetisation impact: Motilal Oswal says assuming 10 percent of the currency in circulation (Rs 1.8 trillion) does not return to the system, nominal GDP growth could be 10 percent in FY17 against pre-demonetisation forecast of11.5 percent. The higher the unclaimed currency, the more detrimental it will be for FY17 GDP.The impact on real GDP growth would depend on how much and how quickly theinflation metrics get affected. Since prices could prove to be sticky over the near term, the entire downgrade in nominal GDP growth could be reflected in real GDP growth in FY17. It implies real GDP growth of 5 percent YoY in 2HFY17, as against 7.4 percent YoY in 1HFY17.2:20 pm Trump impact on visa: The main US visa program for technology workers could face renewed scrutiny under President-elect Donald Trump and his proposed Attorney General, Senator Jeff Sessions, a long-time critic of the skilled-worker program.

H-1B visas admit 65,000 workers and another 20,000 graduate student workers each year. The tech industry, which has lobbied to expand the program, may now have to fight a rear-guard action to protect it, immigration attorneys and lobbyists said.

Trump sent mixed signals on the campaign trail, sometimes criticizing the visas but other times calling them an important way to retain foreign talent.Also read - Buy, sell, hold: 11 stocks for your portfolio2:00 pm Market Check

Equity benchmarks extended losses in afternoon trade as investors continued to assess the impact of demonetisation on company's earnings and economy. Some brokerages started lowering earnings estimates as well as GDP forecast.

The government’s demonetisation drive brings in big challenges to growth in FY17 and FY18, global investment banking firm Jefferies has said in a report. It has also reset Nifty target at 7500.

The 30-share BSE Sensex was down 386.41 points or 1.48 percent at 25763.83 and the 50-share NSE Nifty fell 137.70 points or 1.71 percent to 7936.40.

The BSE Midcap index shed 2.65 percent and Smallcap tanked 3 percent as six shares declined for every share rising on the exchange.

Bank Nifty plunged 600 points as Bank of Baroda, PNB, Federal Bank, Canara Bank, Yes Bank, SBI and IndusInd Bank were down 5-8 percent. Tata Group stocks like Tata Steel and Tata Motors fell nearly 4 percent.