NEW DELHI: Hit by weak global cues, especially from the US and China, benchmark indices tumbled on Tuesday. Even though late hour buying pared some losses, indices ended in the red.
IT and realty stocks were under heavy selling pressure. Metal, pharma and Nifty PSU Bank gained, moving against the market mood.
The 30-share pack Sensex declined 410 points or 0.68 per cent to close at 59,667.60. The index recovered 622 points from its day’s low. Its broader peer NSE Nifty dropped 106.50 points or 0.60 per cent to 17,748.60.
“Rise in US bond yield and crude oil price along with the Chinese crisis acted as key headwinds to the ongoing rally in the global market,” said Vinod Nair, Head of Research at Geojit Financial Services.
After the US Senate blocked the raising of debt ceiling, market commentators warned that this could result in US defaulting on its obligations, a catastrophic scenario. Though there are chances that the situation may be resolved.
Market at a glance:
- NTPC rises another 4 per cent after winning 1.6GW solar project
- India VIX, a barometer of fear and volatility, rises 3 per cent
- Nifty Realty snaps 5-day winning run, ends over 3 per cent lower
- IT stocks continue to crumble ahead of Q2 earnings season
- EIH becomes victim of profit booking, tanks 10 per cent
In the 50-share pack Nifty, PowerGrid was the biggest gainer, up 4.43 per cent. Coal India, NTPC, Sun Pharma, Indian Oil, Bharat Petroleum, Titan and JSW Steel were among other gainers.
Bharti Airtel was the top loser in the pack, down 3.70 per cent. Tech Mahindra, Bajaj Finance, Divi’s Labs, Bajaj Finserv, Wipro and Infosys were among those that traded in the red.
FACTORS DRIVING MARKETS
Tax collections: Advance tax collections from top 20 companies reportedly jumped more than 47 per cent during the second quarter of FY22 to Rs 27,210 crore versus the same period last year, indicating a strong uptick in economic growth.
Power shortage in China: Widening power shortages in China, meanwhile, halted production at a number of factories including suppliers to Apple Inc and Tesla Inc and are expected to hit the country’s manufacturing sector and associated supply chains.
Evergrande crisis: Evergrande has 30 days to make the payment before it falls into default and Shenzen authorities are now investigating the company’s wealth management unit.
Yields rise: US Treasury yields soared to a three-month high, touching 1.516 per cent overnight following the Federal Reserve’s move last week to indicate bond buying program could be tapered as early as November.
Broader market indices also ended lower, in-line with their headline peers. Nifty Smallcap was down 0.50 per cent while Nifty Midcap declined 0.70 per cent. Broadest index on NSE, Nifty 500, was down 0.68 per cent.
Future Retail, CAMS, JB Chemicals, BHEL, Oil India, Power Finance Corporation were gainers from the space while Oberoi Realty, Prestige Estates, Zee Entertainment, KEI Industries, Cyient and Vakrangee were under selling pressure.
European markets were trading lower. London-based FTSE was down 0.61 per cent while Paris and Frankfurt declined 1.72 per cent and 1.13 per cent, respectively. In Asia, barring China and Hong Kong, all markets ended in the red.