Sensex slips over 400 points on Wall Street sell-off

NEW DELHI: The S&P BSE Sensex plunged over 400 points in trade on Friday, led by losses in Reliance Industries, HDFC, L&T, TCS and M&M. Tracking the momentum, the 50-share Nifty index also came under pressure and was trading around its next crucial support level of 7600, weighed down by losses in realty, banks, pharma and auto stocks.

Both Sensex and Nifty fell tracking softer overseas markets ahead of US jobs data later in the day. At 3:04 PM, BSE Sensex was trading at 25482.31, down 1.59% or 412.66 points. Nifty was trading at 7602.40, down 1.54% or 118.90 points.

Foreign institutional investors sold shares worth Rs 1654 crore ($273.2 million) on Thursday, their biggest single-day selling since July 2.

Meanwhile, world stock markets sank, with European benchmarks opening sharply lower after Wall Street's sharp sell-off. Asian stock markets posted modest losses as strong reports on China's economy countered some of the pessimism.

Global stocks are reeling after US markets had their worst day in months. Factors include weak corporate earnings from big companies such as Exxon Mobil as well as the approaching end of stimulus from the Federal Reserve.

Economic sanctions on Russia that have increased tensions with the West also played a role, as did Argentina's debt default Wednesday. And there's also the general worry by investors that stocks are overpriced.

Investors are getting more clues about the state of the global economy with the release of a raft of economic reports. Markets were digesting manufacturing data for major eurozone economies. Later, reports are expected on US employment, consumer spending and sentiment, construction spending and manufacturing. The forecast for the much scrutinized employment report is that US employers added 225,000 jobs in July and that the unemployment rate remained at 6.1 percent, the lowest since 2008. In June, the economy added 288,000 jobs.

Benchmark US crude for September delivery slipped 62 cents to $97.56 a barrel in electronic trading in New York. The contract on Thursday fell $2.10 to close at $98.17, its lowest level since March 17. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 18 cents to $105.84 in London.