Home » Business » Markets slump amid continued political uncertainty
Risk appetite turned sour on back of heavy selling by exchange traded funds in the cash and futures market segment.
The foreign institutional investors sold shares worth a net Rs 368.39 crore on 3 April 2013, as per provisional data from the stock exchanges.
FIIs have invested over $10 billion this year and have been the biggest factor in supporting markets despite sluggish growth and weak macro.
Investor sentiments were also jittery over political instability at Asia’s third-biggest economy after Bhartiya Janta Party veteran LK Advani hinted at an early election on Wednesday shackling the prospects of economic reforms by the beleagureed government.
Mirroring the domestic macro-economic concerns, the Bombay Stock Exchange's 30-share index Sensex dropped 291.94 points to end at 18,509.70 while the National Stock Exchange's 50-share Nifty shed 98.15 points at 5,574.75.
“The political scenario back home is not conducive to invest. If Advani says elections can happen early then it can happen, may be in November,” said Deven Choksey, MD, KR Choksey today.
Global risk appetite also remained frail after weak economic reports on hiring and service industry growth in the U.S fuelled concerns over growth recovery in the world’s biggest economy.
Asian shares ended mixed with Japan's Nikkei notching 2% to 12,634.54 after Bank of Japan’s bold easing measures while Strait Times declined 0.3% to 3,313 today. Markets in Hong Kong, Taiwan and China were shut today for a holiday.
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