By IANS,
New Delhi : Withdrawals by foreign institutional investors and weakness of the rupee led to the recent slump in Indian stock markets, Finance Minister Pranab Mukherjee said Wednesday.
“Both in the month of September and October, a substantial quantum of money has been withdrawn by FIIs,” Mukherjee told reporters after a benchmark index of the Indian equities markets slumped to its lowest level in intra-day trade in almost two years.
The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) closed 2.27 percent down at 15,699.97 points Wednesday after slumping to the near two-year low of 15,478.69 points in the intra-day.
Mukherjee said weakness in rupee was another major factor behind the slump in the stock markets.
Indian rupee slumped to a record low of 52.73 against the US dollar Tuesday. The rupee has weakened almost 15 percent in the last four months.
“Depreciation of rupee also has an impact on the markets,” the finance minister said, adding that the situation was unlikely to improve till the Eurozone debt crisis eased.