Benchmark indices closed over 1 per cent lower amid volatility on Tuesday.

Market started off on a weak note as investors await the outcome of the US Fed meet. Indices extended losses during closing hours, witnessing selling pressure across multiple counters with metals leading the fall. 

The BSE Sensex closed at 55,776.85, down 709.17 points or 1.26 per cent. It recorded an intraday high of 56,720.60 and a low of 55,418.95. The Nifty 50 closed at 16,663.00, down 208.30 points or 1.23 per cent. It recorded an intraday high of 16,927.75 and a low of 16,555.00.

Nifty 50

Breadth favours decliners

The market breadth turned in favour of the decliners with 2,045 stocks declining on the BSE as against 1,342 that advanced while 101 remained unchanged. Furthermore, 17 stocks hit the upper circuit as compared to the four stocks that were locked in the lower circuit. Besides, 116 stocks touched a 52-week high level and 34 touched a 52-week low.

The volatility index rose 4.09 per cent to 26.73. 

Tata Consumer, M&M, Cipla, Shree Cement and Maruti were the top gainers on the Nifty 50 while Tata Steel, Hindalco, ONGC, Coal India and JSW Steel were the top losers.

Vinod Nair, Head of Research at Geojit Financial Services said, “The world equity market lost its momentum as new financial & trade sanctions were imposed on Russia along with the suspension of gas imports. It is a setback for the market sentiment, which was improving in anticipation of a truce in war.”

“The Indian market was outperforming due to ease in commodity prices. World markets are also lower ahead of the US Fed meeting in which the market widely expects FOMC to initiate a rate hike,” Nair. 

Investors are looking forward to the Fed outcome amid inflation concerns. If the Fed turns more hawkish with a rate hike higher than expectations on Wednesday, it can be a major headwind for equity markets across the globe, as per analysts. Rising 10-year US Treasury bond yields are another major negative.

Parth Nyati, Founder, Tradingo said, “Indian equity markets end a five-day winning streak on the back of weak global cues and rising US bond yields ahead of the FOMC meeting outcome on Wednesday. We were outperforming due to a sharp fall in crude oil prices and a pause in selling by FIIs however Nifty and Banknifty were trading near their important resistance levels after a smart pullback.”

“It seems that the market is factoring in a positive outcome on the Russia-Ukraine front as there is a sharp fall in commodity prices however the slowdown in China is also causing pressure on commodity prices which is a tailwind for the Indian equity markets.  The most important event apart from the Russia-Ukraine war is the FOMC meeting outcome,” said Nyati.

Metals lose shine

On the sectoral front, all indices except Nifty Auto and Nifty FMCG closed in the red. Metals, oil & gas, IT and financials witnessed increased pressure.

Nift Auto was up 0.57 per cent while Nifty FMCG was up 0.17 per cent.

Meanwhile, Nifty Metal faced the highest losses and was down over 4 per cent at closing. Nifty IT and Nifty Oil & Gas were each down over 2.5 per cent. Nifty Private Bank was down 1 per cent. Nifty Bank, Nifty PSU Bank and Nifty Financial Services were each down nearly 1 per cent. 

Broader indices

Broader market also faced pressure.

The Nifty Midcap 50 was down 0.85 per cent while the Nifty Smallcap 50 was down 1.29 per cent. The S&P BSE Midcap was down 0.68 per cent while the S&P BSE Smallcap was down 0.88 per cent. 

comment COMMENT NOW