Early trading in Indian equity markets witnessed a significant downturn today, primarily influenced by the decline in sectors such as banks, financials, technology, metals, and energy stocks.
Sensex and Nifty performance
The BSE Sensex recorded a substantial decline of over 450 points, while the NSE Nifty dipped below the 19,400 mark.
At 9:30 am, the BSE Sensex, which comprises 30 key stocks, exhibited a decline of 451 points or 0.69 percent, reaching 65,061. Meanwhile, the NSE Nifty, another important benchmark, experienced a drop of 132 points or 0.67 percent, settling at 19,397. The India VIX, often referred to as the "fear gauge," also rose by 3.07 percent to reach the 3.07 level.
Major laggards among Sensex firms included NTPC, Axis Bank, IndusInd Bank, Maruti, UltraTech Cement, ICICI Bank, Tata Steel, and Bajaj Finserv. Meanwhile, Nestle, Hindustan Unilever, HDFC Bank, and Asian Paints were among the gainers.
In Asian markets, Seoul, Tokyo, and Hong Kong registered declines, while Shanghai remained in positive territory. The US markets experienced a decline of over 1 per cent on Tuesday.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 2,034.14 crore on Tuesday, as per exchange data. The global oil benchmark, Brent crude, witnessed a 0.10 per cent decline, reaching USD 90.83 per barrel.
Market experts suggest that negative global cues are impacting the markets in the near term. The continuous rise in US bond yields, leading to consistent FII selling, shows no sign of relenting. The dollar index now stands above 107, and the US 10-year bond yield has reached 4.83 per cent.
This scenario implies that FIIs are likely to continue selling, placing the bulls at a disadvantage, according to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. However, he added that attractive valuations in certain segments could prompt DIIs (Domestic Institutional Investors) and retail investors to purchase stocks in those sectors.
On Tuesday, the BSE benchmark declined by 316.31 points, or 0.48 per cent, to settle at 65,512.10, while the Nifty fell 109.55 points, or 0.56 per cent, closing at 19,528.75.
Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd, noted that markets may continue to exhibit intraday volatility ahead of the monetary policy announcement on Friday, with the primary driver of current pessimism being FII selling.