Rupee hits historic low of 68.70 against dollar, Sensex tanks 500 points

The S&P BSE Sensex slipped over 500 points, while the broader 50-share index Nifty fell over 3 per cent to trade below its key psychological level of 5,150.

Oil prices have shot up recently after the US indicated a possible military action on Syriafor its alleged use of chemical weapons against Syrian population.

The Indian rupee hit a record low of 68.70 against the US dollar as dollar outflows continued from emerging markets. The partially convertible rupee was at 67.95, against its previous close of 66.24.

"Currently the risk-reward doesn't appear favorable for Indian equities. If the recent policy measures manage to check INR depreciation and we see a moderate recovery into 2H supported by a good monsoon and a pre-election spending then a year-end rally is likely. In the prevailing uncertain macro environment, our portfolio bias is defensive. Visibility on start of an earnings upgrade cycle is limited. OW sectors are IT Services, Health care, Energy, and 'sin stocks' within the consumption basket," said Bharat Iyer of JP Morgan.

At 10:22 a.m.; the 50-share index was at 5,126.8, down 160.65 points or 3.04 per cent. It touched a high of 5,236.05 and a low of 5,118.85 in intraday trade today.

The S&P BSE Sensex was at 17,450.75, down 517.33 points or 2.88 per cent. It touched a high of 17,851.44 and a low of 17,448.71.

"The selling pressure on Nifty was so intense that the it could not hold intraday support of 5,351 and eventually closed well below 5,300 mark for the first time after September 06, 2012. At this juncture, the low of the weekly 'Hammer' is still intact. However, considering the strong downtrend and overall dejected sentiments, the possibility of breaking this support level cannot be ruled out," said Angel Broking note.

"In case of a sustainable breakdown below 5,254, the Nifty may initially slide towards the 5,180 mark (61.8 per cent Fibonacci retracement level). On the flipside, 5,307 - 5,355 would act as intraday resistance levels in coming trading session," the report added.

The foreign institutional investors sold shares worth Rs 1,373.99 crore while domestic institutional investors were net buyers worth Rs 480.5 crore on Tuesday as per the provisional data from the National Stock Exchange.

The Asian stocks were under pressure on concerns over a US strike on Syria. The Nikkei 225 fell 2.32 per cent, Hang Seng was down 1.60 per cent, Kospi was 0.43 per cent lower and Shanghai Composite slipped 0.24 cent lower.