The markets opened on a subdued note as investors adjust to tighter monetary conditions following the Reserve Bank of India’s (RBI) rate hike of 50 basis points in its June meeting. The BSE Sensex fell 350 points to 54,537, while the NSE Nifty shed 100 points to slip below 16,300. All Sensex-30 shares opened in red as Axis Bank, HCL Tech, Bajaj Finserv, L&T, Ultratech Cement, M&M, Nestle, and Tech M led losses.
On the flip side, ONGC, Dr Reddy’s, NTPC, Coal India, Bajaj Auto and Reliance were the handful of stocks in green on the two benchmarks.
In the broader markets, the BSE MidCap and SmallCap indices were also in the negative territory, down up to 0.75 per cent.
Sectorally, barring pharma and oil & gas pockets on the Nifty, all other indices sat in red. Nifty IT, realty, banks, financials and auto were down up to 0.6 per cent.
Among stocks, Lupin rose 2 per cent. The drug maker has received a tentative approval from the US FDA to market Ivacaftor tablets, used to treat cystic fibrosis, in America.
Oil India, too, defied market sentiment and surged over 5 per cent as brent continues to trade at elevated levels of $124 a barrel.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: “With the monetary policy coming on expected lines without any significant market impact, the focus now will be on the US inflation data and its implications for interest rates and equity markets. The fact that the trading volume in US markets is very low indicates that the market is waiting for direction. Big market moves are likely after the data is out. In India, the near-term texture of the market is ‘sell on rallies. FPI’s sustained selling has become almost predictable. Only a declining inflation rate in the US and the possibility of the Fed turning less hawkish than now can change the trend of FPI selling. FPI selling in banking stocks has led to depressed valuations in this segment, particularly in high-quality banking majors. This is an opportunity for medium- long- term investors.”
US stocks fell on Wednesday as Treasury yields rose above the psychologically important 3 per cent level and oil prices jumped, fanning worries about inflation and the outlook for interest rates. The Dow Jones Industrial Average fell 269.24 points, or 0.81 per cent, to 32,910.9; the S&P 500 lost 44.91 points, or 1.08 per cent, to 4,115.77; and the Nasdaq Composite dropped 88.96 points, or 0.73 per cent, to 12,086.27.
Australian shares slipped on Thursday, impacted by banking stocks extending losses after the central bank raised interest rates by the most in 22 years, while Crown Resorts climbed after gambling regulators approved its buyout by Blackstone. The MSCI world equity index, which tracks shares in 50 countries, fell 0.56 per cent. In other key markets, Japan’s Nikkei rose 0.2 per cent to 28,298.39 and S&P 500 E-minis futures inched 0.1 per cent lower.
Asian stocks traded mostly lower after a decent winning streak and overnight fall of US shares. Those trading higher were supported by a pick-up in tech stocks. MSCI’s index of Asia-Pacific shares outside Japan was down by 0.22 per cent.
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