Weak global cues due to rising Iraq crisis dampen investor sentiment

The Sensex and Nifty fell nearly 0.3 per cent at the closing session on Monday due to profit-booking by funds and retail investors owing to weak global cues. Rising crude oil prices due to escalating crisis in Iraq dampened the investor sentiment.

After plunging 209.92 points or 0.83 per cent at 24,895.59 in the mid-session, the Sensex partly wiped off its losses to end at 25,031.32, down 74.19 points.

Similarly, the Nifty after dipping below the crucial 7,500 points by falling 59.6 points or 0.79 per cent to 7,451.85, ended the session down 18.1 points at 7,493.35.

Among BSE sectoral indices, FMCG, IT and TECk indices fell the most by 4.06 per cent, 1.56 per cent and 1.12 per cent, respectively. On the other hand, oil & gas and metal indices remained investors' favourite and were up 1.43 per cent and 1.13 per cent, respectively, followed by auto 0.73 per cent and capital goods 0.55 per cent.

ONGC, Hero MotoCorp, BHEL, SSLT and M&M were the top five Sensex gainers, while the top five losers were ITC, Infosys, HUL, TCS and Wipro.

Rajesh Agarwal , Head Research, Eastern Financiers, said in a report “Markets are expected to remain volatile during the week as escalation in internal skirmish in Iraq, which could result in further rise in crude oil prices, and expectations of a below normal monsoon with the threat of the El Niño weather phenomenon looming, have injected a fresh sense of uncertainty in the economy. Higher freight rates have also raised the risk of higher inflation. However, we expect the markets to discount these events and be back on track with focus on long-term growth story.

The investors remain cautious. As a consequence, profit-booking would continue to mould the market movements during the week.

Near the close of the week, the markets would seek direction from the announcement of deposit and bank loan growth as also forex reserves numbers expected towards the end of the week.”

Meanwhile, foreign portfolio investors (FPIs) sold shares worth Rs 220.65 crore as on last Friday, as per provisional data from the stock exchanges.

European stocks fell, after posting a ninth weekly gain in ten, due to continued tensions in Iraq and as the euro area manufacturing weakened.

Asian stocks were up, with the regional benchmark index extending six weeks of gains, as a report showed Chinese manufacturing beat economists’ estimates in June.

(This article was published on June 23, 2014)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.