Home Business Sensex Slumps 370 pts At Open, Nifty Slips Below 17,400; Key Points

Sensex Slumps 370 pts At Open, Nifty Slips Below 17,400; Key Points

Sensex Slumps 370 pts At Open, Nifty Slips Below 17,400; Key Points


Sensex Today: Indian equity markets opened in the red on Tuesday morning fears of aggressive monetary tightening and weak global cues. Frontline indices opened lower in Tuesday’s trade as Nifty50 dropped over 100 points to trade below 17,400 levels and the S&P BSE Sensex declined over 350 points at 58,405 levels.

Broader markets, too, lost in tandem as Nifty Midcap 100 and Nifty Smallcap 100 slipped over 0.7 per cent.

While NTPC, M&M, Sun Pharma were supporting the indices to trim losses; Infosys, Wipro, Tech Mahindra contributed heavily to the losses
All sectors opened in the negative zone with Nifty IT and Nifty Metal indices battered in trade.

V K Vijayakumar, chief investment strategist at Geojit Financial Services, said: “The market mood has suddenly changed after the release of the Fed minutes which indicate steeper rate tightening than what the market had discounted. Now, the focus will be on what the Fed chief Powel will say at the Jackson Hole symposium on Friday. If he sounds less hawkish there can be a relief rally; otherwise, the present drift will continue. The trend in US markets is hugely important for India since the correlation between the two markets is very high.”

“The sharp decline in India is also due to some profit taking by DIIs who have been sustained sellers in recent days. Profit booking is normal since the market had risen too fast (Nifty rallied 18% from the June lows) in 2 months. Investors can now buy the dips in a calibrated manner. High-quality financials, autos and capital goods can bounce back sharply when the market trend turns,” Vijayakumar added.

Global Cues

Asian shares were down for a sixth straight session on Tuesday after a renewed spike in European energy prices stoked fears of recession and pushed bond yields higher, while tipping the euro to 20-year lows. Benchmark gas prices in the European Union surged 13 per cent overnight to a record peak, having doubled in just a month to be 14 times higher than the average of the past decade.

Tokyo stocks opened lower Tuesday after jitters over the speed of rate hikes by the US Federal Reserve drove down Wall Street shares overnight. The benchmark Nikkei 225 index fell 1.00 per cent, or 288.64 points, to 28,505.86 in early trade, while the broader Topix index lost 0.84 per cent, or 16.73 points, to 1,975.86.

Wall Street ended sharply lower on Monday as investors fretted about a US Federal Reserve gathering later this week in Jackson Hole, Wyoming, that is expected to reinforce a strong commitment by the central bank to stamp out inflation.

The views and investment tips by experts in this News18.com report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.

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