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Stocks plunge, gold soars

Gold price of Rs 37,920 per 10 gram is the highest in the domestic market till date, says Surendra Jain

By Our Special Correspondent in Mumbai

  • Published 8.08.19, 1:13 AM
  • Updated 8.08.19, 1:13 AM
“Gold prices witnessed safe-haven buying due to global economic uncertainty on trade war escalation and weak investment sentiment,” HDFC Securities senior analyst (Commodities) Tapan Patel said.
“Gold prices witnessed safe-haven buying due to global economic uncertainty on trade war escalation and weak investment sentiment,” HDFC Securities senior analyst (Commodities) Tapan Patel said. Shutterstock

The BSE Sensex slumped 286 points on Wednesday after the RBI slashed the benchmark lending rate but lowered the growth estimate for the current financial year, underscoring the risks to economic revival amid multiple headwinds.

After swinging 494 points in choppy trade, the 30-share index settled 286.35 points, or 0.77 per cent, lower at 36690.50.

The broader NSE Nifty also fell 92.75 points, or 0.85 per cent, to 10855.50.

Most rate-sensitive stocks ended on a negative note, with BSE auto, bankex, finance and realty indices cracking up to 2.10 per cent.

M&M was the worst performer in the Sensex pack, tumbling 5.62 per cent, after the company reported a 52.56 per cent decline in consolidated profit after tax to Rs 894.11 crore for the June quarter, hit by lower vehicle sales.

Other laggards included Tata Steel, Tata Motors, SBI, Vedanta, Axis Bank, ITC, RIL, Maruti, L&T, HDFC twins and Kotak Bank, which fell up to 4.75 per cent.

“The downward revision in real GDP from 7 per cent to 6.9 per cent is likely to affect the short-term sentiment in the markets. Increasing flows to NBFCs will boost credit availability, which in turn is good news for the MSME sector and exporters of all verticals,” said Pushkar Mukewar, co-founder and co-CEO of Drip Capital.

Meanwhile, gold prices surged Rs 1,113 to hit an all-time high of Rs 37,920 per 10 gram in the national capital on sustained buying from jewellers amid strong trend overseas as fresh trade tensions between the US and China prompted investors to move towards gold as a safe haven asset.

“Gold prices witnessed safe-haven buying due to global economic uncertainty on trade war escalation and weak investment sentiment,” HDFC Securities senior analyst (Commodities) Tapan Patel said.

“Gold price of Rs 37,920 per 10 gram is the highest in the domestic market till date,” Surendra Jain, vice-president of the All India Sarafa Association, said.

Silver also followed suit and rose Rs 650 to Rs 43,670 per kg on increased offtake by industrial units and coin makers.

The rupee dropped 8 paise to finish at 70.89 against the dollar. This is the fifth straight session of loss for the domestic currency, during which it has lost a hefty 210 paise.

The rupee depreciated 2 paise to 70.84 against the dollar intra-day. Brent crude futures, the global oil benchmark, slipped 0.54 per cent to USD 58.62 per barrel.

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