Market Extends 3-Day Losing Streak; Sensex clears 61k, Nifty below 18,150 | Jobs Vox


Indian markets failed to capitalize on gains in global cues as they extended their losing streak for a third consecutive day on Thursday. The Sensex cleared the 61,000 mark and the Nifty 50 gave 18,150 levels. Small-cap stocks were the hardest hit in the broader market. All sectoral indices were in the red, while capital goods, autos, banking, durables, metals and oil and gas witnessed heavy sell-offs. India’s volatility index fell by over 2%.

The Sensex fell 241.02 points or 0.39% to end at 60,826.22, while the Nifty 50 fell 71.75 points or 0.39% to close at 18,127.35. During the trading session, the Nifty 50 even fell below 18,100 before the correction. Bank Nifty fell by 209.15 points or 0.49% to 42,408.80.

In the broader market, the small-cap indices on both BSE and NSE fell by nearly 2% each. On the Belgrade Stock Exchange, the index of capital goods fell by 536 points, while the index for cars and durable goods fell by 306 points and 308 points. The metals and oil and gas indexes were down about 1% each.

Ultratech Cement, Infosis, Asian Paint and Kotak Bank were among the gainers, however, growth was at a slower pace.

Top bearers were M&M, Bajaj Finserv, IndusInd Bank, Tata Motors, L&T, Tata Steel, Akis Bank, NTPC and Tech Mahindra.

S Ranganathan, head of research at LKP Securities said, “Markets continued their downward path even today despite steady opening and absence of data on any new strain except Omicron sub-variants elsewhere.

The LKP expert further added: “With the gravity reversing on the back of rising interest rates and with the PE expansion struggling, the street seems to prefer to stay a little light ahead of the new calendar year and earnings season. All sector indices finished in the red during today’s trade”.

On the day of its debut, shares of Sula Vineyards closed at 331.15 per piece is lower by 7.50% compared to its quotation, while it is lower by 7.24% compared to the issue price at the IPO. India’s largest wine cellar made its debut on the flat market on Thursday. The company’s IPO was launched from December 12 to 14 and was oversubscribed 2.33 times by the last day of the public offering. Its IPO price was fixed 340 per share up to 357 per share.

Also, Vinod Nair, head of research at Geojit Financial said, “Positive sentiments from global markets failed to fuel optimism in domestic indices. Losses were extended to domestic stocks thanks to hawkish comments from the RBI’s MPC minutes, which suggested that a premature pause in rate tightening would be a “costly policy mistake at this time.” On the other hand, earnings in the U.S. which were better than expected amid recession fears and a strong consumer confidence reading lifted global sentiment.”

The performance also comes after the minutes of the RBI’s December policy meeting.

In the minutes of the meeting, the RBI discussed a number of risks both globally and domestically, and individual members of the MPC highlighted the need to change the stance of monetary policy. The RBI has hinted that the battle to tame inflation is not yet over and the central bank needs a decisive slowdown in inflation for a policy change. However, the MPC also found that the impact of the rate hike has yet to be felt in the real economy.

On the other hand, the Indian rupee strengthened against the US dollar in the interbank foreign exchange market ahead of the US GDP data. The local unit ended at 82.7625 per dollar compared with the previous day’s 82.81 per dollar. Meanwhile, the 1-year USD/INR implied yield continued its upward trend and jumped around 7 basis points to 2.15%.

Global markets gained momentum after gas prices eased, pushing expectations for 12-month US consumer inflation below 6.7% this month – the lowest level since September last year. This raised investor confidence that the US Federal Reserve may take a softer approach in the upcoming monetary policy.

This month, the Fed raised the main interest rate by 50 basis points, which will be the seventh increase in the current fiscal period. The US central bank, however, continued to maintain its hawkish stance and hinted at more rate hikes on credit cards. But softening US inflation is accelerating hopes for a more dovish policy approach.

Disclaimer: The views and recommendations given above are those of individual analysts or brokerage firms and not of Mint. We advise investors to check with certified professionals before making any investment decision.

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