Sensex tanks in early trade as rout in Turkish currency takes toll

Posted on by KNBT

NEW DELHI: Equity markets on Monday morning took a hit as global cues turned negative on back of rout in Turkish currency.

The 30-share BSE Sensex opened 175 points in the red at 37,693.19 and extended losses to nearly 300 points in early trading. At 9.32 am, the index was down 275.35 points at 37,593.88.

The broader 50-share NSE Nifty was down 0.75 per cent and had slipped below the 11,350-mark.

The Turkish currency crisis took its toll on the rupee too, with the currency slipping to a record-low of 69.62 against the US dollar on Monday morning.

The Turkish Lira tumbled on worries over Turkish President Tayyip Erdogan’s increasing control over the economy and deteriorating relations with the United States.

“The plunge in the lira which began in May now looks certain to push the Turkish economy into recession and it may well trigger a banking crisis,” said Andrew Kenningham, chief global economist at Capital Economics.

The PSU Bank sub-index was most poorly hit in the morning session, trading almost 2.50 per cent in the red. Metal and financial service sub-indices were also down 1.50 per cent each.

Investors would be looking forward to July retail inflation data, due later in the day for further cues.

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