Mumbai: The Indian equity markets suffered their biggest crash and the rupee sank to its lowest level since early September 2013, amid panic selling in global financial markets as a rout in Chinese equities forced investors to shun riskier assets and seek the safety of American treasury bonds.
The rupee closed at 66.64 against the dollar after falling to a low of 66.73 in intra-day trade. Equities across Asia and Europe got hammered on Monday as fears about the impact of a slowdown in China’s economy on global growth left investors rattled across the world.
Around Rs 7 lakh crore of investor wealth was wiped out on Black Monday, the highest ever, as the Sensex plunged by 1,624.51 points, or 5.94 per cent, to end the trading day at 25,741.56. Incidentally, seven of the top 10 crashes have occurred on Mondays.
In percentage terms, this was the biggest fall in the Sensex since January 7, 2009, and the 29th biggest overall, while it is the biggest-ever single-day fall in absolute points.
The Nifty, too, fell by 490.95 points, or 5.92 per cent, to close at 7,809. The provisional data released by stock exchanges showed that foreign portfolio investors had dumped equities worth Rs 5,275.40 crore.
“This was just waiting to happen. Investors remained complacent and global markets did not factor in what was happening in China for a long time,” said Andrew Holland, chief executive officer of Ambit Investment Advisors.