September 3, 2019 / 4:57 AM / 14 days ago

Nifty, Sensex slump 2% after dismal growth data

A broker reacts while trading at his computer terminal at a stock brokerage firm in Mumbai, December 11, 2018. REUTERS/Francis Mascarenhas/Files

BENGALURU (Reuters) - Indian shares plunged 2% on Tuesday in a broad-based selloff, as investors fretted over data that showed the economy grew at its weakest pace in over six years.

The broader NSE Nifty ended down 2.04% at 10,797.9, its biggest drop since July 8, while the benchmark BSE Sensex closed 2.06% lower at 36,562.91 in its worst day since October 11.

Asia’s third-largest economy expanded just 5% year-on-year in the three months ended June, official data showed on Friday, far below the 5.7% growth forecast in a Reuters poll.

Banks were among the worst hit on the first day of September, with the Nifty PSU Bank index sliding 4.9% to its lowest close since May 2016.

Punjab National Bank, United Bank of India and Indian Bank sank 8.5%-11.7% after the government announced a series of mergers involving 10 public sector banks.

Private-sector lender ICICI Bank Ltd fell 4.3%, its sharpest drop since mid-May, while index heavyweight Reliance Industries Ltd dropped 3.4% to a near four-week closing low.

Reporting by Chris Thomas in Bengaluru; Editing by Subhranshu Sahu

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