OUCH

Indian stock markets are bleeding because of rupee notes and US votes

Quartz india
Quartz india

It is turning out to be a bloody Wednesday (Nov. 09) for stock markets in India.

Benchmark indices, Sensex and Nifty, both fell as much as 4%. On the BSE, the Sensex closed 338.6 points lower, while the Nifty was down 111.55 points on the National Stock Exchange, at closing.

The markets have been clobbered by a double-whammy: The possibility of a Donald Trump presidency in the US, and the surprise move last night (Nov. 08) by the Narendra Modi government to pull out Rs500 and Rs1000 notes from circulation.

Global markets have also been falling as the results of the US presidential elections trickle in. Futures trading in the US saw the Dow Jones Industrial Average drop over 700 points. Trump’s policies on trade treaties and conservative tariff plans on imports aren’t favoured by investors.

In India, prime minister Narendra Modi’s surprise ban on Rs500 and Rs1,000 currency notes is unnerving investors. That is primarily because most small businesses, which drive 40% of the Indian economy, are heavily dependent on cash.

While the effect of the currency notes ban will be short-term, a Trump win could drag the gloomy global slump for some more time, and India will hurt in the process. Stay tuned.

This post was updated with closing numbers for stock indices.

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