Stock market benchmark indices closed nearly 1 per cent lower on Wednesday. Market started on a weak note as investors remained concerned about slower global growth and aggressive monetary tightening by the US Fed.
The BSE Sensex closed at 56,819.39, down 537.22 points or 0.94 per cent. It recorded an intraday high of 57,079.03 and a low of 56,584.04. The Nifty 50 closed at 17,038.40, down 162.40 points or 0.94 per cent. It recorded an intraday high of 17,110.70 and a low of 16,958.45.
Over 2,200 stocks declined
The market breadth returned in favour of the decliners with 2,208 stocks declining on the BSE as against 1,159 that advanced, while 118 remained unchanged. Furthermore, 13 stocks hit the upper circuit as compared to the two stocks that were locked in the lower circuit. Besides, 141 stocks touched their 52-week highs and 29 touched their 52-week lows.
According to Vinod Nair, Head of Research at Geojit Financial Services, “Market continues to be in the grip of high volatility following a heavy selloff in the global markets led by elevated energy crisis and weak Chinese economic outlook underpinned by prospects of the US rate hikes.”
“Investors are weighing the possibility of a global slowdown due to monetary tightening by central banks, lockdown in China and Russia -Ukraine war. This has resulted in an outflow of funds from equity markets to safe havens,” said Nair.
As per S Hariharan, Head- Sales Trading, Emkay Global Financial Services, “As has been the trend for the last few months, the outlook for earnings in FY23 has continued to deteriorate. Growing restrictions on Indonesian palm oil exports would pose input cost challenges for all FMCG companies — this sector faces the highest risk of earnings downgrades in this quarter.”
“Similarly, fuel and commodity cost pressures would also impact earnings for cement and consumer durables companies’ earnings. Thus far, the trend of Q4 earnings season has pointed to disappointments and severe stock reactions to earnings misses. Banks and commodities companies are relatively sheltered from disappointments but are also consensus over-weight positions for market participants. We believe that 2-wheeler companies can surprise to the upside on monthly volume trajectory as student-led demand and marriage season demand push numbers up from depressed bases,” Hariharan added.
Hero Motocorp, Tata Steel, Asian Paints, HCL Tech and Eicher Motor were the top gainers on the Nifty 50, while Bajaj Finance, Bajaj Finserv, Tata Consumer, Shree Cement and Adani Ports were the top losers.
Sectoral indices
On the sectoral front, all sectoral indices except Nifty Media closed in the red. Nifty Bank, Nifty Financial Services, Nifty Consumer Durables and Nifty Oil & Gas each closed over 1 per cent lower. Nifty PSU Bank, Nifty Private Bank, Nifty IT, Nifty FMCG, Nifty Pharma and Nifty Healthcare Index were each down nearly 1 per cent.
Broader market under pressure
Broader indices closed in the red. Nifty Midcap 50 was down 0.93 per cent, while Nifty Smallcap 50 was down 0.27 per cent. The S&P BSE Midcap was down 0.88 per cent, while the S&P BSE Smallcap was down 0.61 per cent.
The volatility index rose 7.38 per cent to 20.61.