Mkts back in red on negative global cues

BFSI Stocks Under Pressure

♦ During the day, Sensex fell 585.99 pts or 0.88% to 65,842.10

♦ Nifty declined 140.40 pts or 0.71% to 19,671.10

♦ FIIs bought equities worth Rs263.68 cr

Mumbai: Equity benchmark index Sensex tumbled 551 points to close below the 66,000 level on Wednesday due to profit-taking in banking, financial and energy stocks amid a sharp jump in global crude oil prices. A sluggish trend in global equity markets following lingering geopolitical worries also sapped the risk appetite of investors, traders said.

After a day’s breather, the 30-share BSE Sensex plunged 551.07 points or 0.83 per cent to settle at 65,877.02. During the day, it fell 585.99 points or 0.88 per cent to 65,842.10. The Nifty declined 140.40 points or 0.71 per cent to 19,671.10.

“Fresh weakness in banking and financial majors combined with a downtick in other heavyweights like Reliance is pointing towards further slide,” said Ajit Mishra, SV-P (technical research), Religare Broking Ltd.

“The Indian markets appear relatively better placed compared to its regional peers. US markets have caught a bit of a tailwind with the Fed speakers highlighting that there is a lower need to raise rates going forward,” added Jaykrishna Gandhi, head (business development, institutional equities), Emkay Global Financial Services.

“Asia markets were mixed in choppy trading on Wednesday after economic data from China showed stronger-than-expected growth. European stocks inched lower on Wednesday as an explosion at a Gaza hospital complicated diplomatic efforts to rein in conflict in the Middle East,” said Deepak Jasani, head (retail research), HDFC Securities.

The market is showing early signs of fatigue within the mid and small-cap space and there is a clear investor shift to large-caps and safe havens. While the geopolitical events have not yet cracked the Indian market, it has definitely slowed the momentum.“Profit booking ensued in Indian markets, spurred by weak global sentiments and escalating Middle East tensions.

A sudden rise in the tension has led to instability in energy prices; Brent prices rapidly rose above $92.5 by the day’s closing time. The initial Q2 earnings disappointments by the IT and financials sector may have prompted attention in the domestic markets. All these factors are presumed to be a knee-jerk reaction as the total outlook on the domestic market is stable, underpinned by healthy Q2 result forecast and favourable fiscal position,” said Vinod Nair, head (research) at Geojit Financial Services.