Here’s What Dalal Street Made Of Thursday’s Rout

India's equity benchmark fell to its lowest in six months as the government remained non-committal over a fiscal stimulus to boost the slowing economy.

While the NSE Nifty 50 Index fell 1.62 percent to 10,741.35, the S&P BSE Sensex declined 1.59 percent to 36,472.93. The broader market represented by the NSE Nifty 500 Index, too, dropped 1.64 percent.

The stocks listed on the BSE lost more than $30.5 billion in market capitalisation today. The cumulative losses stand at over $230 billion since the presentation of the Union Budget on July 5, according to Bloomberg data.

On the NSE, The Nifty Realty, Nifty PSE and Nifty Metal indices were among the worst performers. The Nifty IT Index was the only gainer, up 0.35 percent.

Here's what market experts have to say about the stock market's performance...

‘No Stimulus Anytime Soon'

“Valuations of frontline stocks remain expensive while earnings remain depressed. Though, one would want to lap up small stocks at the point of time, their illiquid nature would make them susceptible to any fall in the market. The best strategy at this point of time would be to either wait on the sidelines or go short,” independent analyst Anand Tandon said. “The government's intervention is required but don't see that coming anytime soon. The government doesn't acknowledge structural slowdown yet and has broadly stated its intent of inducing stimulus only by lowering interest rates by the Reserve Bank of India,” he told BloombergQuint.

‘Investors Shouldn't Panic'

“The market is currently in a state capitulation and investors are feared. Investors are trying to recover their losses in loss-making stocks by selling quality stocks,” Deven Choksey, managing director at K.R. Choksey Shares & Securities Pvt., said. “Market fundamentals are not as bad as what the share prices reflect. I would advise investors to not panic as these conditions would not last forever.”

‘A Doomsday Scenario For Market'

“Global concerns combined with domestic slowdown has painted a doomsday scenario for the market,” said Mayuresh Joshi, fund manager at Angel Broking. “Any stimuli push from the government, transfer of surplus reserves from the RBI to government and outcome of Jackson Hole Summit will now provide direction to the markets. Stimulus is required but not necessarily in the form of monetary stimulus. Any measure that could provide sentimental push would aid companies to tide through cyclical pressures.”

‘Revival Of Animal Spirits Needed'

“As the economic slowdown continues, expect overall weak market sentiment to continue unless there is government's intervention with policy measures which are perceived to be market-friendly and business-friendly,” Mihir Vora, director and chief investment officer at Max Life Insurance, said. “Revival of animal spirits and risk-taking by corporates and businesses is needed.”

‘Turnaround Not Expected In September'

“The momentum is downward and do not see any turnaround in September. Positive news has to come from the government for the direction to change. The government intervention is needed in form of stimulus, taxation and NBFC issues,” UR Bhatt, managing director at Dalton Capital Advisors, told BloombergQuint.

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