The BSE benchmark Sensex on Thursday plunged by over 526 points, its biggest fall in nearly two years, to end at 18,719.29 due to massive selling on worries that capital inflows may dry up if US Fed's sticks to its plan of slowing down monetary stimulus later this year.
The stock markets were also under heavy pressure after rupee touched life-time low of 59.93 against the dollar. Sensex tumbled 526.41 points, or 2.74 per cent, to 18,719.29, recording biggest single day fall since September 2011.
Across market, over 1,650 stocks fell and just 650 rose. Investor wealth worth Rs 1.5 lakh crore was eroded today. US Fed Chairman Ben Bernanke last night ended weeks of speculation saying that the Federal Reserve will likely slow its bond-buying programme later this year and end it next year because the US economy is showing Strong sign of recovery.
A pullback in Fed's USD 85 billion-a-month programme is being interpreted as a move that will hit inflows to emerging markets like India, said traders.
The plunge in domestic markets was led by stocks of realty, metal, banks and power shares with 28 scrips of 30-share Sensex ending down. Only, Wipro and Sun Pharma rose. Heavyweight stocks like Reliance Industries dropped 3.84 per cent and Infosys lost 2.92 per cent.
Jindal Steel andPower sank 9.62 per cent on major sell-off by participants. Among others, BHEL, Dr Reddy Lab., GAIL India, HDFC Ltd,HDFC Bank, ICICI Bank, SBI, Hindalco, Sterlite Industries, Larsen and Toubro, Bharti Airtel, Mahindra and Mahindra, Maruti Suzuki Tata Motors fell sharply.
The broad-based National Stock Exchange index Nifty dipped below 5,700 level by losing 166.35, or 2.86 per cent to close at 5,655.90.
Also, SX40, the flagship index of MCX-SX, closed 308.22 points, or 2.70 per cent, down at 11,118.85. Brokers said sentiments turned extremely bearish after rupee slumped to all-time low of 59.93 to a dollar, tracking weak trend in the other global currencies.
In the Asian region today, Hong Kong's Hang Seng indexfell 2.88 per cent and Japan's Nikkei shed 1.74 per cent. TheUS Dow Jones index closed 1.35 per cent down and Nasdaq shed1.12 per cent last night.