Indian Stock Market Plunges Amidst Global Uncertainty
Indian benchmark indices, Sensex and Nifty, experienced a sharp fall, each shedding about 1%, amidst weak global cues and profit booking. This downturn snapped a three-day winning streak, reflecting investor concerns about both domestic and international economic factors.
Market Opening and Intraday Movement
The market opened on a weak note, with both Sensex and Nifty declining significantly. At 10:50 am, the Sensex was down by 706 points, trading at 76,335.94, while the Nifty fell 190 points to 23,121.60. Market breadth showed mixed sentiments, with 1,830 shares advancing, 1,240 declining, and 119 remaining unchanged.
Global and Domestic Factors
Despite initial positive reactions to lower-than-expected US inflation figures, global market momentum faltered, impacting the Indian market. Investor sentiment was further weighed down by concerns over potential earnings slowdowns during the ongoing Q3 earnings season, as well as macroeconomic challenges. These include uncertainties around the Union Budget 2025, the US Federal Reserve's rate decisions, and stretched market valuations.
The January effect, historically characterized by market weakness, has also contributed to the downturn, with the Nifty shedding approximately 2% this month. Analysts suggest that domestic markets are oversold, with unchanged fundamentals and persistent headwinds hindering a market rebound.
Sectoral Performance
Sectoral indices presented a mixed picture. Nifty IT was the worst performer, plunging over 2% due to significant corrections in major stocks like Infosys, TCS, Wipro, and HCLTech. Nifty Bank also fell over 1%, influenced by weak performances from Axis Bank, ICICI Bank, and Kotak Mahindra Bank.
Conversely, Nifty Energy, Nifty Metals, and Nifty Infra managed to post gains of nearly 1% each, supported by a decline in the dollar index, which eased commodity price pressures. Infosys shares plummeted over 5%, becoming the worst-performing stock on the Nifty 50, despite posting better-than-expected Q3 earnings. Axis Bank shares also fell nearly 5% after their Q3 results, as higher slippages and lagging deposit growth sparked concerns.
Individual Stock Movements
Reliance Industries' shares surged almost 3% after better-than-expected Q3 performance and recovery hopes. Other major gainers included Hindalco, BPCL, and Coal India. The broader market mirrored the weakness of the benchmarks, with the midcap and smallcap indices also experiencing losses.
Market Outlook
Market experts noted that while a recent rally had raised hopes, persistent macroeconomic and corporate earnings concerns have kept investors cautious. The "sell-on-rise" strategy dominates as investors await clarity on key events, including the Union Budget and global central bank policies.
Analysts emphasize the need for stability in macroeconomic conditions, improved corporate earnings, and supportive policy measures for a sustained recovery. Pockets of strength exist in sectors like energy and metals, but broader market fundamentals remain challenging.
0 comments:
Post a Comment