Sensex collapses 1,000 pts, sees swift recovery; Nifty below 11,150; DHFL cracks 55%

NEW DELHI: Market went through some scary moments on Friday when the Sensex crashed over 1,000 points in a span of just a few minutes, but recouped more than 700 points immediately thereafter.

The 30-share index had plunged to an intra-day low of 35,993.64 while the Nifty breached below 11,100.

At 2.23 pm, the BSE index was down 449.43 points, or 1.21 per cent, at 36,671.79 while the NSE barometer lost 143.40 points, or 1.28 per cent, at 11,090.95.


Yes Bank was the biggest Sensex loser, cracking 34 per cent to hit a one-year low after the Reserve Bank Wednesday curtailed the term of its founding CEO Rana Kapoor and asked the private sector lender to look for his replacement by January 2019.

Financial stocks took a big beating. Shares of Dewan Housing Finance Corporation, Indiabulls Housing Finance and Can Fin Homes all plunged up to 55 per cent.

"The cost of borrowing for NBFCs is going to shoot up and they may face challenge in raising money in light of recent news on IL&FS. However, this knee-jerk reaction is baffling," said Hitesh Agrawal, EVP & head - retail research at Religare Securities.

Commenting on financial crisis at IL&FS, Sanjiv Bhasin, Executive VP-Markets & Corporate Affairs, India Infoline said, “There is pressure on short-term money both in the short-term and longer-term debt flows. The cost of money has escalated and there is tightness in the money market. The lack of clarity about IL&FS exposure is leading to the knee-jerk reaction. There is no clarity on government’s bailout for the company so far. However, the fear will subside after the government steps in. Once there is stability in the money market, things will be as usual.”

India VIX, the fear gauge, spiked over 11 per cent to 15.58.


Broader markets too took a battering as BSE Midcap and Smallcap indices dropped nearly 6 per cent each. However, both the indicies recovered significantly and were trading up to 3.5 per cent down at around 1.30 pm.

Among the sectoral indices on BSE, realty suffered a loss of over 3 per cent, with Indiabulls Real Estate, Godrej Properties and HDIL as top losers.

However, shares of most oil marketing companies, including Oil India, Indian Oil Corporation, Petronet LNG, BPCL, Reliance Industries, GAIL and ONGC stood even as despite broader market crashed. The BSE Oil & Gas index was trading over 1 per cent up.