Click to play videoNew Delhi: The US downgrade effect was clear on Indian and Asian markets. The Sensex ended a volatile session closing below the 17000 mark for the first time in 14 months.
A worried Finance minister held out assurances that the India growth story remains intact.
At 6 am, Asian markets were in a sea of red on the US downgrade and by 9.15 am, Indian investors too pressed the panic button. As a result the Sensex plunged over 500 points to go below the 17,000 mark - the lowest in 14 months.
"People are worried and they are going to be worried for sometimes. It's US and European problem but we cannot be insulated," said an investor.
"It's wait and watch situation. Nobody can really predict," said another investor.
Finance Minister Pranab Mukherjee tried to talk the markets out of the panic.
"This development could have some impact on India. But as India growth story is intact and its fundamentals strong we are in a better position than many other countries," said Mukherjee.
But not many were convinced. After a brief recovery on the back of positive developments in Europe, India looked at the US markets futures and panicked again.
While the Indian authorities may brag of insulation from global worries, in today's world where financial markets are connected more than ever. Just strong domestic economic fundamentals may not be just enough to withstand another global financial crisis.
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