Mumbai: Benchmark equity indices Sensex and Nifty faced significant selling pressure on Monday, retreating from gains made during the Muhurat trading day. The NIFTY 50 opened marginally higher at 24,315.75 points but soon fell, while the BSE Sensex declined by 10 points to 79,713. Both indices dropped further in early trade, with the Sensex crashing over 1000 points and the Nifty plunging 229.4 points to 24,074.95.
The downturn was driven by a mix of factors, including cautious investor sentiment ahead of the US elections and the Federal Reserve's interest rate decision.
Ajai Bagga, a banking and market expert, highlighted four key events impacting market sentiment. "Markets brace for the outcome of the US presidential election on Tuesday," he stated. "The Fed meets on Wednesday and Thursday, with a 25 basis points (0.25 per cent) rate cut expected. Additionally, the OPEC+ alliance will not be raising out production levels due to slow demand."
Bagga further noted, "Warren Buffet has increased his cash hoard at Berkshire to a record USD 325 billion and has cut back on share buybacks, signalling expectations of lower US markets ahead. In such an event-heavy week, volatility will be much higher than usual. Waiting on the sidelines is a good strategy in such times."
Foreign Institutional Investors (FIIS) continued their selling streak, offloading equities worth Rs 211.93 crore, contributing to the negative sentiment. In October alone, foreign investors withdraw a staggering Rs 94,000 crore from the Indian stock market, marking the worst month for outflows due to high domestic valuations and the attractiveness of Chinese stocks.
From the 30-share Sensex pack, major laggards included Sun Pharma, Reliance Industries, Infosys, Tata Motors, Titan, Maruti, and NTPC.
From the 30-share Sensex pack, major laggards included Sun Pharma, Reliance Industries, Infosys, Tata Motors, Titan, Maruti, and NTPC. Mahindra & Mahindra, Tech Mahindra, HCL Technologies, and IndusIand Bank were among the few gainers.
On the National Stock Exchange, sectoral indices saw mixed performances, with the Nifty IT index declining by 0.57 per cent. Of the Nifty 50 stocks, only nine opened with gains, while 42 stocks saw declines. Mahindra & Mahindra emerged as the top gainer surging 3 per cent, followed by Cipla, Tech Mahindra, and HCL Technologies. Notable losers included Sun Pharma, Bajaj Auto, Infosys, and Adani Ports.
Quarterly results announcements are set for today from various companies, including Indian Railways Finance Corp, IRCTC, Exide Industries, Raymond, Sundaram Finance, and ABB India, among others, for the second quarter of FY2025.
In Asian markets, South Korea's KOSPI index led gains with a 1.49 per cent increase. Meanwhile, Japan's Nikkei was closed for a cultural holiday, and Hong Kong's Hang Seng saw a marginal rise of 0.16 per cent.
