Gone In 120 Minutes: How Market Tumbled On Last Day Of Weekly Options

Indian markets posted their biggest single-day decline in three weeks amid volatility on account of weekly options expiry, pausing 10 straight session of gains.

The S&P BSE Sensex fell more than 1,000 points, or 2.6%, to end the day at 39,728. The NSE Nifty 50 dropped close to 300 points, or 2.43%, at 11,680. That snapped the longest winning streak in over a decade for Sensex, and the Nifty’s best run of gains in more than five years.

With Thursday’s fall, the Nifty has given up gains worth six of the last 10 trading sessions. This is also the first instance in the ongoing October futures and options series when the benchmarks ended in losses.

The market will be “volatile because valuations have moved above long-term average multiples”, Shibani Kurian, head of equity research at Kotak Mahindra Asset Management Co., said in an interview with Bloomberg Television. The Sensex is trading at 21 times estimated earnings, which is two standard deviations above its five-year average.

Here are some highlights of the day...

Banks Underperform

The Nifty Bank, which recovered 725 points from the Wednesday’s low of 23,149, not only gave up its entire gains, but also dragged down the benchmarks. The 12-stock gauge fell as much as 900 points, but pared some of the losses to end 3.3%, or 800 points, lower at 23,072.

Nifty Bank in last two sessions

• Wednesday's Low: 23,149
• Wednesday's Close: 23,874
• Recovery From Day's Low: 725 Points
• Thursday's High: 24,087
• Thursday's Close: 23,072
• Fall From Day's High: 1,015 Points

All Sectoral Indices Decline

All sectors witnessed selling pressure in Thursday’s trade, led by banking and information technology stocks.