India Sensex plunged over 600 points

Sensex plunged over 600 points on today’s trading. Of course Equity benchmarks saw their worst intra-day decline in a month on Monday dragged down by the weakness across the globe. The Sensex, which notched up nearly a 1.71 per cent gain in the previous week, plunged by 626.71 points at 14,784.92, the biggest fall since July 6, the day the Budget was presented. The index touched the day's low of 14,740.63. All the Sensex stocks closed with moderate to notable losses.

Arun Mewawalla, associate vice president, derivatives & technicals, Quantum Securities in an interview to Economic Times said “Meltdown in Chinese markets led to a sharp fall in our markets. Traders were seen unwinding long positions and creating new shorts. At the moment, Nifty has strong support at 4280 and if it breaches this level then it will head lower to 3900”.

There could be many reasons for this down. One was that turned the Market sentiment bearish was a reports of an international agency saying the stocks might decline up to 15 per cent on concerns that lower monsoon rain would slash farm output and cut consumer spending. Another growing concern is of on China’s slump and of course the last trading day of previous week at Dow.

The later half of the selling witnessed today was also on the account of weak start of the trading week at the European Markets. With Dow futures nearly down by 2% on the first day of the trading week surely portrays a bumpy ride in the coming sessions.

Though the NY Manufacturing Index Shows First Growth Since April '07, the Dow has nearly lost 2% on the opening Bell as I am articulating this post.