A man walks inside the Bombay Stock Exchange (BSE) building in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Investors Lose Rs 2.22 Lakh Crore As Markets Post Biggest Single-Day Loss In 2019  

Investor wealth eroded by Rs 2.22 lakh crore as markets recorded their biggest single-day fall this year after the Reserve bank of India delivered a rate cut on expected lines, but failed to assuage concerns regarding the non-bank finance sector.

The 30-share BSE Sensex plummeted 553.82 points, or 1.38 percent, to close at 39,529.72.

Tracking weak sentiment in the broader market, the market capitalisation of BSE-listed companies tumbled Rs 2.22 lakh crore to Rs 1.53 lakh crore.

"Nifty had rallied in the recent days, leading up to the RBI policy. With a 25 basis points repo cut widely anticipated, indices corrected post the announcement. A possible reason of the fall could also be that there was no mention in the policy about addressing the liquidity stress in the NBFC space.

"With recent news around DHFL and the possible contagion effect, several financials corrected heavily today. However, I believe that market will soon take cognizance of the change in policy stance to accommodative," Amar Ambani, president and research head, YES Securities said.

The broader NSE Nifty plunged 177.90 points, or 1.48 percent, to end at 11,843.75.

Home, auto and other loans may cost less as the RBI cut interest rates for the third time this year to their lowest level in nine years.

The RBI cut the repo rate by 25 basis points to 5.75 percent and cut the reverse repo rate by an equal proportion to 5.50 percent and expected banks to transmit these to home, auto and other loan borrowers faster.

Also read: RBI's Dovish Stance Lifts Indian Bonds, Fails to Cheer Equities

From the 30-share pack, 21 companies closed with losses, led by IndusInd Bank, Yes Bank, SBI, L&T, Tata Steel and M&M.

All BSE sectoral indices ended in the red, with oil and gas, bankex, capital goods and finance falling up to 3.04 percent.

In the broader market, the BSE mid-cap and small-cap indices ended up to 1.77 percent lower.

At the BSE, 1,859 scrips declined, while 740 advanced and 132 remained unchanged.

Also read: Bond Investors, Bankers Keep Wary Eye On DHFL After Rating Downgrade To ‘Default’

Bloomberg Quint

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