Bears tightened their grip in early trade on December 10 after the exit polls of states elections indicated a possible loss of BJP in three major states—Madhya Pradesh, Chhattisgarh and Rajasthan.
“Exit polls give BJP cold sweat and seem to be treading the same path as opinion polls,” Nomura said, adding going by the polls, the BJP will lose its control over Rajasthan and will find retaining Madhya Pradesh and Chhattisgarh a tall order.
Return of TRS in Telangana has been largely expected, he said.
Barclays said there could be a risk of populist policies if results come as exit polls suggest. All five states elections results will be announced on December 11.
The 30-share BSE Sensex plunged 649.53 points or 1.82 percent intraday to 35,023.72 and the 50-share NSE Nifty fell 204.40 points or 1.91 percent intraday to 10,489.30.
The fall in global peers after China’s weak trade data also dampened market sentiment. Japan’s Nikkei, China’s Shanghai Composite, Hong Kong’s Hang Seng and South Korea’s Kospi fell 1-2 percent, tracking negative close on Wall Street, at the time writing this article.
The broader markets also traded in line with frontliners with the BSE Midcap and Smallcap indices declining nearly 2 percent each. About five shares declined for every share rising on the BSE.
All sectoral indices were also in the red. Nifty Bank, Auto, FMCG, IT, Metal, Pharma and Realty were down 1.5-3 percent.
“This is a very challenging time for global and local equities and we do not believe current correction is a buying opportunity as the trend is not in favour of market recovery,” Gautam Shah of JM Financial told CNBC-TV18.
He said many global equity markets are in a confirmed bear market and India cannot escape global bear markets trend. He expects Nifty to go down to 10,400 if 10,600 gets broken.
More than 200 stocks hit 52-week low, which include major ones like Ashok Leyland, Bharat Forge, Cipla, Coal India, JSPL, NTPC, Oil India, ONGC, Sun Pharma, Tata Motors, Tata Global and Vedanta.
Among others, Amara Raja Batteries, Balkrishna Industries, BHEL, Deepak Fertilizers, Force Motors, Godrej Agrovet, HT Media, JK Tyre, Jindal Stainless, NBCC, PPAP Automotive, Quess Corp, Quick Heal Technologies, Reliance Capital, Shankara Building Products, Sharda Cropchem, Sun Pharma Advanced Research Company, Varroc Engineering and Va Tech Wabag also touched 52-week lows.