Market Wrap: Sensex, Nifty end with deep cuts; investors lose over ₹2 lakh crore in a day
Stock market today: Sensex closed with a loss of 796 points, or 1.18 per cent, at 66,800.84 while the Nifty ended below the 20,000 mark at 19,901.40, down 232 points, or 1.15 per cent.
Frontline indices the Sensex and the Nifty closed with solid losses on Wednesday, extending their losses into the second consecutive session amid mixed global cues ahead of the US Fed policy outcome while the US Treasury yields hovered near multi-year highs.
The Fed is likely to keep rates unchanged today but the risk of inflation is not over yet with crude oil prices surging sharply in the recent past.
Crude oil benchmark Brent Crude futures fell over a per cent in today's trade, slipping from its 10-month high level but they are still up nearly 30 per cent in the last three months after the output cut by OPEC+. Brent Crude traded near the $93 per barrel mark around 3:30 pm.
Among major global peers, the UK's FTSE, France's CAC 40 and Germany's DAX were in the green when the Sensex closed. Investors await Fed policy outcome today. The week ahead has policy announcements from several other central banks.
"The Federal Reserve is expected to leave rates unchanged at the current range of between 5.25 per cent and 5.5 per cent when it concludes a two-day meeting. The Fed meeting leads a week jammed with central bank meetings, with policy announcements in Sweden, Switzerland, Norway, Britain and Japan all due later in the week," reported Reuters.
Read more: Fed policy meet begins today: How will the US Fed interest rate decision impact the stock market?
Stock market today
Market benchmarks suffered strong losses and a majority of their components ended in the red.
Sensex plunged 869 points to hit the intraday low of 66,728.14 during the session while the Nifty fell 254 points to touch its intraday low of 19,878.85.
Sensex closed with a loss of 796 points, or 1.18 per cent, at 66,800.84 while the Nifty ended below the 20,000 mark at 19,901.40, down 232 points, or 1.15 per cent.
Shares of HDFC Bank emerged as the top drag on Sensex, followed by those of Reliance Industries.
Mid and smallcaps also ended in the red but they still outperformed the benchmark Sensex. The BSE Midcap index dropped 0.33 per cent while the Smallcap index ended 0.51 per cent lower.
The overall market capitalisation of the firms listed on BSE dropped to nearly ₹320.6 lakh crore from ₹323 lakh crore in the previous session, making investors poorer by nearly ₹2.4 lakh crore in a single session.
Top Nifty gainers and losers today
As many as 39 stocks ended in the red in the Nifty index while the remaining 11 stocks managed to end higher.
Shares of HDFC Bank (down 3.87 per cent), JSW Steel (down 2.70 per cent) and Reliance Industries (down 2.29 per cent) ended as the top losers in the Nifty index.
On the other hand, shares of Power Grid Corporation of India (up 2.35 per cent), Coal India (up 1.12 per cent) and Oil & Natural Gas Corporation (ONGC) (up 0.75 per cent) ended as the top gainers in the index.
Sectoral indices today
All sectoral indices ended with losses. Nifty Bank fell 1.29 per cent while the Nifty Private Bank index ended 1.20 per cent lower and the Nifty PSU Bank index closed with a loss of 1.18 per cent.
Nifty Financial Services, Metal and Realty indices also closed over a per cent lower.
Experts' views on markets
"The domestic markets remained under pressure due to rising US bond yields and a stronger greenback. Concerns reigned over upcoming Fed policy, interest rate trajectory and rising oil prices. Bank Nifty underperformed today due to rising cost of funds and reduction in deposits leading to a moderation in net yield," said Vinod Nair, Head of Research at Geojit Financial Services.
“Correction has been due for some time and valuations too were getting expensive after the recent spike, and hence investors resorted to profit-taking ahead of the outcome of the US FOMC meeting on interest rates. There are also concerns that the ongoing tension between the US and Canada could have some bearing on the markets, and if the situation flares up there could be some impact on our markets," said Shrikant Chouhan, Head of Research (Retail), Kotak Securities.
Technical views on Nifty
Chouhan observed that intense selling saw the Nifty slip below the 20,000 mark, which is largely negative.
"For the bulls now, 20,000- 20,030 could act as immediate resistance areas while 19,825-19,775 could act as a crucial support zone for the traders,” said Chouhan.
Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas pointed out that on the daily charts, the Nifty is in the process of retracing the rise it witnessed from 19,223 to 20,222.
"On the downside, it can drift towards 19,840 where the 38.2 per cent Fibonacci retracement level is placed. The Nifty has witnessed a faster retracement and also breached the low of 19,914 (wave IV low) which suggests that the rise from 19,223 to 20,222 has completed a wave," said Gedia.
"The daily momentum indicator still has a positive crossover, however, we shall assign more weightage to the price action and expect the momentum to align with the price action sooner rather than later. In terms of levels, 19,840 – 19,800 is the crucial support zone while 20,050 – 20,100 should act as an immediate hurdle zone," said Gedia.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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