Mumbai - the BSE Sensex fell almost 2.5 percent on Tuesday, as lenders such as Yes Bank (YESB.NS) fell on concerns that the Reserve Bank of India (RBI) will announce new cash draining action to protect the rupiah, which hit a record low.
Rupee depreciation undermine confidence of traders who are concerned that Central Bank measures to tighten liquidity already threaten economic growth.
Great has fallen 8.1% from July 15, the first RBI announced steps to drain cash.
Rupee record low 61.80 stopped on Tuesday means the new measures could follow or existing ones will be distributed for a long period of time to suppress the instability.
However, the market outside appointment Raghuram Rajan, the Chief Economic Adviser in the Ministry of finance, as the Governor of the RBI, starting in early September, can help maintain a mood, raising expectations for a new approach.
"My sense is the liquidity tightening measures are here to stay. There can be any time, as there is no clarity in the (United States) the FED program, "said tapering Aneesh Srivastava, Chief Investment Officer at IDBI Federal life insurance Co Ltd.
BSE Sensex fell 2.34 percent, or 449.22, to end at points 18, 733.04. It was its biggest one-day percentage fall since June 20. It closed below the psychologically important mark 19000.
Nifty fell 2.52 percent or 143.15 points, to end at 5, 542.25, marking its lowest close since April 12.
The banking subindex fell 3.9 percent on continued speculation that RBI may announce additional steps to prop up the rupee.
Yes Bank fell 8.2 per cent, while HDFC Bank (HDBK.NS) lost 3.8 percent and ICICI Bank (ICBK.NS) Ltd. ended 4 percent lower.
Financial technologies (Fite.NS) shares lost 19.7 percent after its commodity unit exchange national Spot Exchange Ltd (NSEL) stop its electronics, trade services.
Multi commodity exchange of India Ltd (MCEI.BO), which is 26 percent owned by financial technologies, also fell 10 per cent even as the Exchange said it was "completely different" entities from the NSEL.
Bharat heavy electricals Ltd. (BHEL.NS) fell by 6.8%, adding to Wednesday's 19.3% decline, marking its lowest intraday level since November 2, 2005 year. The company's quarterly profit dropped 49 percent on sharply lower sales in its power and industry enterprises in a slowing economy.
Drug maker Lupin Ltd. (LUPN.NS) shares fell 0.9 percent a day ahead of its earnings. The company can ignore the consensus operating profit forecast for the April-June quarter when it reports results on Wednesday, according to data from Thomson Reuters StarMine.
Among the gainers power equipment producer Crompton Greaves (Crom.NS) shares rose 3.1 percent after the company's quarterly operating profit beat expectations, dealers said.
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