Chinese crash triggers market fall, Sensex plunges 542 points

Mumbai, Jan 4  With the Chinese markets crashing -- coupled with disappointing macro-economic data and profit-booking, the Indian equity markets plunged on Monday.

A barometer index of the Indian equity markets provisionally closed the day's trade deep in the red receding by 542 points or 2.07 percent.

Initially, both the bellwether indices of the Indian equity markets opened on a flat note, but soon they plunged deep in the red, following their Asian peers.

Asian bellwethers declined on the back of the Chinese markets' crash which was triggered by a lower-than-expected purchasing managers' index (PMI) data.

The PMI data battered the Chinese Shanghai index which halted trade for the remainder of the day after crashing by seven percent -- leading to the circuit breaker coming into play on the very first day of its operations. 

The cascading impact of the falling Chinese markets impacted other regional exchanges, including the Japanese indices which declined by three percent.

In addition, weak domestic PMI data further dented sentiments. This, coupled with lack of participation and recent consolidation at the bellwethers, prompted some investors to book profits.

Besides, investors were seen cautious regarding the upcoming third-quarter earnings season which starts from January 14.

The Indian VIX (volatility index) hovered around 16 percent.

The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) sank by 542 points, or 2.07 percent.

Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) provisionally closed the day's trade deep in the red. It dived by 173.50 points, or 2.18 percent, at 7,789.70 points.

The Sensex of the S&P BSE, which opened at 26,116.52 points, provisionally closed at 25,618.69 points (at 3.30 p.m.) -- down 542.21 points or 2.07 percent from its previous day's close at 26,160.90 points.

The Sensex touched a high of 26,116.52 points and a low of 25,596.57 points in intra-day trade.

The Sensex closed the previous session on January 1, up a paltry 43.36 points, or 0.17 percent, while the Nifty inched up by 17 points, or 0.21 percent.

The market breadth was in the favour of the bears -- with 1,597 declines and 1,290 advances.