Sensex, Nifty Edge Lower on Weak Global Indices; Bank stocks most affected
India’s equity benchmarks fell slightly on Tuesday, led by losses in banking, auto and financial services stocks amid weak global signals. The Sensex fell 432 points and Nifty hit an intraday low of 15,747 but clawed back some early losses after exit polls indicated the Bharatiya Janata Party (BJP) retained power in Uttar Pradesh , Goa, Uttarakhand and Manipur.
As of 9:28 a.m., the Sensex was down 3 points to 52,840 and the Nifty 50 index slipped 8 points to 15,854.
Hopes for stable economic reforms backed by the ruling government were on track after exit polls indicated the return of the BJP to power in Uttar Pradesh, which sends the most MPs to Rajya Sabha, analysts said. Exit polls indicated that the BJP returned to power with an average of 250 seats in the state assembly. While the Aam Aadmi Party (AAP) was seen forming a majority government in Punjab.
Meanwhile, global markets were trading sharply lower due to rising oil prices in international markets amid the ongoing conflict between Ukraine and Russia. Japan’s Nikkei fell 0.94%, Hong Kong’s Hang Seng fell 0.4% and Taiwan Weighted fell 2%.
Overnight, Wall Street suffered its biggest drop in more than a year on Monday as another jump in oil prices threatened to reduce inflation’s grip on the global economy.
The S&P 500 fell 3%, its biggest drop in 16 months, after a barrel of US oil jumped to $130 overnight on the possibility that the United States could ban imports from Russia . Stocks around the world also fell earlier in the day, taking inspiration from the moves in oil.
The benchmark S&P 500 index fell 122.78 points to 4,201.09. The Dow Jones Industrial Average fell 797.42 points, or 2.4%, to 32,817.38.
The Nasdaq composite slipped 482.48 points, or 3.6%, to 12,830.96. The technology index is now 20.1% below its record set in November. Such a drop means the index is now in what Wall Street calls a bear market. The S&P 500 is down a more modest 12.4% from its peak reached in early January.
At home, eight of the 15 sector indicators compiled by the National Stock Exchange were trading higher, led by the 1.5% gain in the Nifty IT index. The Nifty Media, Pharma, PSU Bank and Consumer Durable indices were also trading on a positive note.
In contrast, the Nifty Bank, Auto, Financial Services, Metal and Private Bank indices were trading lower.
The broader markets outperformed their larger counterparts, with the Nifty Midcap 100 Index up 0.9% and the Nifty Smallcap 100 Index up 1.5%.
Hindalco was Nifty’s biggest loser as the stock fell 4% to Rs 596 on profit taking after a massive rally. Tata Steel, JSW Steel, Maruti Suzuki, HDFC Bank, Axis Bank, UPL, ONGC, Eicher Motors, Asian Paints, HDFC, Hero MotoCorp, State Bank of India, Hindustan Unilever and SBI Life also fell 1-3%.
On the other hand, NTPC, Power Grid, Tata Consultancy Services, Tech Mahindra, Infosys, Sun Pharma, Tata Consumer Products, HDFC Life, Cipla and HCL Technologies were among the winners.
The overall market breadth was positive as 2,135 stocks were up while 677 were down on BSE.