Down 317 points: Sensex posts 5th straight fall on geo-political tension

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Mains Paper 3: Economy | Growth

From UPSC perspective, the following things are important:

Prelims level: Non-performing assets (NPAs), Sensex

 Mains level: Not much


  1. Stock markets on Friday fell for a fifth session, taking the Sensex down by another 317 points as State Bank of India plunged 5.36 per cent after it reported a rise in non-performing assets (NPAs) and investors continued to fret over rising US-North Korea tensions.
  2. Economic Survey said achieving the high end of the 75-7.5 per cent growth projected previously will be difficult and called for more interest rate cuts to boost the economy.

Reasons behind the fall

  1. Weakening global risk appetite in the wake of US-North Korea tension.
  2. Weakness in the rupee against the American currency and lacklustre global shares growth.


Non-performing assets

  1. A nonperforming asset (NPA) refers to a classification for loanson the books offinancial institutions that are in default or are in arrears on scheduled paymentsof principal or interest.
  2. In most cases, debtis classified as nonperforming whenloan payments have not been made for a period of 90 days.