After trading below the red line through most of the trading session, the Indian stock markets slid further lower towards the end of the trading session. Among sectoral indices, the ones that are leading the losses include realty, IT and consumer durables.
The Sensex today is down by around 365 points (1.32%), while the NSE-Nifty is down by around 122 points (1.45%). The correction in the midcap and smallcap stocks has been steeper with the S&P BSE Midcap and S&P BSE Smallcap indices trading lower by about 1.95% and 2.81% respectively.
The rupee is currently trading at Rs 63.58 to the US dollar. This is the lowest level witnessed by the Indian currency against the greenback during the ongoing calendar year. In the last one week alone the currency has depreciated by about 1.8%. One of the reasons attributed to the fall in the rupee is the sell-off in equity markets by foreign institutional investors (FIIs). It is worth mentioning here that from an all-time high closing level of 29,682, the BSE-Sensex has tanked about 8.5% till date. The selling by FIIs has resulted in a surge in demand for US dollars. The outflow of dollars has put the rupee under pressure.
Public sector bank stocks are trading with significant losses with Oriental Bank of Commerce, Bank of India and Canara Bank leading the losses. As per an article in Reuters, India's largest public sector lender State Bank of India's plan of raising up to Rs 150 billion (US$ 2.4 billion) via sale of its shares is now likely to take place in June instead of April. The reason for this could be attributed to the recent fall in the stock price. Since February-end, the stock price has fallen by about 8.5%. The public sector lender received the approval of shareholders to raise funds in February 2015. The funds will be used to strengthen SBI's balance sheet amidst expectations of recovery in loan demand in India. It is worth noting that the share sale would happen via the "fast track" follow-on offering route. The government has asked the bank to decide the timing of the FPO during its quarterly results between May 23 and 25,2015.