The BSE Sensex plunged over 1,000 points whereas the Nifty index on the National Stock Exchange slid below the psychological level of 8,000 in the early trade.
Global markets remained jittery on Friday as Britain exited from the European Union. On the domestic front, the BSE Sensex plunged over 1,000 points whereas the Nifty index on the National Stock Exchange slid below the psychological level of 8,000 in the morning trade.
Reacting on the UK referendum, NSE’s volatility index, the domestic equivalent of the VIX fear gauge, soared 16.81 per cent to highest since February 19, 2016. On Friday, India Vix Index on the National Stock Exchange opened at 18.02 and has touched a high and low of 21.05 and 16.15, respectively, in, trade so far.
Karthik Rangappa, VP- education services, Zerodha said, “Although there was a near equal split in opinion, the Brexit outcome comes in as a bit of a shock. The focus now would be on Bank of England and the kind of policy action they would roll out. Yes, the sentiment across the global markets are highly negative and this is clearly rubbing off on Indian markets. However, this is not the time to make any hard conclusions but instead wait for events to unfold. I do believe Brexit fall is giving the Indian investor an opportunity to buy quality stocks.”
At 11.42 am, all the 51 components in the Nifty 50 index were trading in red with Tata Motors plunging the most 11.67 per cent, followed by Tata Motors DVR (down 10.28 per cent), Hindalco (down 9.08 per cent), Tata Steel (down 9.06 per cent) and ICICI Bank (6.56 per cent).
Seeking to allay concerns over Brexit impact on India, the government on Friday said the economy has enough “firepower” to deal with the situation, even as stocks and the rupee took a massive plunge.
Economic Affairs Secretary Shaktikanta Das cited India’s domestic fundamentals as the reason the country will not suffer from any long-term impact of Brexit.
(With agency inputs)