Indian stock markets fell today while the rupee fell to record lows as rising inflation concerns weighed on investor sentiment for global equities. The S&P BSE Sensex fell 1150 points to 52,930 while the NSE Nifty 50 lost 2.2% to end at 15,808. The Sensex has tumbled over 4,000 points this month amid a global sell-off amid rising inflation in the US, which could lead to a faster-than-expected rate hike by the US Federal Reserve.
In India, entering the so-called bear zone, gauges of small and medium-sized companies fell for the ninth session to widen their losses to 20% from their record. The S&P BSE Smallcap index fell 2%, while the Midcap gauge fell 2.2% on Thursday. The market expansion was negative on the NSE with an advance fall ratio of 1:4. This was the 11th consecutive session of breadth remaining in negative territory.
Foreign investors have been selling stocks in India since September and withdrawing around $24 billion.
“Inflation remains a major concern for the market. Weak economic growth outlook, prolonged Russo-Ukraine war, volatility in commodity prices, sustained FII selling and rising bond yields weighed on investor sentiments. Nifty has registered a decline of 15% from its 52-week high,” said Siddharth Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd.
“The rupee fell to an all-time low of 77.63 on RBI’s aggressive stance to check inflation and strengthening of the US dollar. The dollar index touched a 20-year high of 104.5. Nifty is now at March’s low of 15,671 (today’s low is 15735) and closing below it may lead to further downside in the market. While the overall weakness is expected to continue, the markets are now in oversold territory after a sharp decline in the last few trading sessions. India VIX rose 6% to zone 25 – 7-week high, indicating that uncertainty in the market may continue for some more time,” he said.
short term trend nifty Nagraj Shetty, Technical Research Analyst, HDFC Securities says downside remains and further weakening is likely till 15670. “But Nifty is more likely to reverse on the downside around 15500 level. Confirmation of the reversal pattern could lead to an upside rally in the market. The current weakness indicates a kind of selling climax and usually such excessive sell participation is part of a significant bottom reversal,” he said.
Ajit Mishra, VP – Research, Religare Broking said a breakdown below 15,650 will give way to 15,400. “Participants should align positions according to the trend and pay more attention to position management,” he said.