New Delhi: The equity and currency markets nosedived on Monday over heightened trade tension between the US and China, and the political developments related to Jammu and Kashmir in the Parliament.
Union Home Minister Amit Shah earlier in the day proposed to revoke special status to Jammu and Kashmir given under the Article 370 of the Indian Constitution. Shah introduced a bill under which the State will be split into two Union Territories - Jammu and Kashmir with an Assembly and Ladakh without one.
As a result of the global and domestic tensions, the Sensex closed 418.38 points lower at 36,699.84. The broader Nifty fell by 134.75 points or 1.23 per cent to 10,862.60.
Read more:Gold surges to all time high, nears Rs 37,000
Market analysts said the Kashmir development was an add-on to the US-China trade tension, which was the main cause of the Monday's market fall. Global markets came under further stress after China vowed to respond to the US tariffs announced last week.
The Indian rupee crashed by 113 paise -- the biggest single-day drop in past six years following the slide in Yaun, the currency of China which declined below 7 to a dollar for the first time since 2008.
Gold prices surged Rs 800 to hit an all-time high of Rs 36,970 per 10 grams in the bullion market on Monday. Tracking the movement of gold, silver also soared Rs 1,000 to 43,100 per kg on the back of robust demand from industrial units and coin makers.
The investor sentiment has been weak owing to an exodus of foreign funds on account of weak corporate earnings results and the controversial super-rich tax proposed in the Budget last month.
It is to be noted that July is the worst single-month performance for the market in the last 17 years and investors wealth more than Rs. 14 lakh crore evaporated from the capital markets since the Union Budget was presented on July 5.
