Sensex down 800 points: Why is stock market falling today?
Stock markets continued their downward slide as bearsish sentiment turned investors cautious with benchmark indices coming under selling pressure on Thursday, with the Sensex falling more than 700 points and the Nifty declining over 1% amid continued foreign fund outflows, rising crude oil prices and broad-based selling.The Sensex was at 71,619.85 at 1:24 pm, down 860.44 points or 1.19%. The index opened at 72,192.89 and touched an intraday low of 71,527.98.The Nifty 50 was at 22,327.20 at 1:25 pm, down 293.25 points or 1.30%. It opened at 22,543.70 and fell to an intraday low of 22,301.30.
The sell-off was broad-based, with Nifty Midcap 50, Midcap 100 and Smallcap 100 falling 1.07%, 1.13% and 1.35%, respectively. India VIX, the market's fear gauge, jumped 9.08%.AUTO STOCKS LEAD THE SELL-OFF
The biggest pressure came from the auto sector, with the Nifty Auto index falling 3.78%. Investors were concerned after auto companies reported numbers that fell short of expectations ahead of the festive season, raising questions over the strength of demand.
M&M was the biggest Sensex loser, falling 4.21%. Maruti Suzuki declined 3.76%, while Tata Steel fell 3.25%.
Other major losers included ITC, down 2.65%, Adani Ports, down 2.35%, BEL, down 2.30%, Hindustan Unilever, down 2.27%, PowerGrid, down 1.98%, Trent, down 1.93%, and L&T, down 1.85%.
Among the few stocks holding up the market, HDFC Bank rose 0.87%, Infosys gained 0.75%, Kotak Mahindra Bank advanced 0.74%, HCLTech was up 0.46% and TCS gained 0.15%.
Foreign investor selling remains one of the biggest concerns for the Indian market.
FIIs sold Indian equities worth Rs 10,148.41 crore on Wednesday, according to the latest data. Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said selling had become particularly intense over the past two trading sessions.
"The sustained FII selling became intense during the last two trading days when the FIIs sold equity for a total of Rs 20,128 crores. With the US 10-year bond yield rising further to 5.3%, FIIs may continue to sell," he said.
Vijayakumar noted that FIIs sold Rs 45,536 crore through exchanges in September, while investing Rs 9,676 crore through the primary market.
"The strength in the US bond yields and expectations of further weakness in the Indian large-caps might be the reason for this apparently inconsistent FII activity," he said.CRUDE OIL RISES AGAIN
Crude oil prices have also turned higher, adding to concerns for India, which is heavily dependent on imported oil.
Brent crude was at $99.82 a barrel, up 1.83%, while WTI crude rose 1.99% to $92.22.
The rise in crude prices can add to India's import bill and inflation pressures while also squeezing corporate margins. The market has been particularly sensitive to oil prices because of the ongoing geopolitical tensions and uncertainty around the US-Iran situation.
Vijayakumar said crude remains a key trigger for the market's next move.
"This appears to be a short-term phase in the market. Things will turnaround when crude declines. And there is hope on that front with the Brent crude declining below $98," he said.MOST SECTORS IN RED
The sell-off has spread across most sectors. Nifty Auto fell 3.78%, Media declined 2.64%, Metal dropped 2.34%, Chemicals fell 1.82%, Realty declined 1.61% and Consumer Durables dropped 1.59%.
Nifty Financial Services Ex-Bank fell 1.39%, MidSmall Financial Services declined 1.36%, Oil & Gas fell 1.13% and Pharma dropped 0.98%.
Nifty IT was among the few sectors in positive territory, gaining 0.49%, while Private Bank rose 0.14%.
The breadth was weak, with Nifty 500 down 1.19%, while Nifty Healthcare declined 0.99%.
The sharp fall comes after the Sensex and Nifty entered Thursday already on course for an eighth consecutive weekly decline. The combination of heavy FII selling, elevated US bond yields, crude oil volatility and weak broader-market participation continues to keep sentiment under pressure.
Vijayakumar, however, said the current phase could be temporary.
"Investors can use this weak phase in the market to accumulate high-quality stocks, particularly large-caps in growth segments where the risk-reward ratio is favourable for investment," he said.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)- Ends
An engineer who swapped codes for headlines, Sonu Vivek is a product of IIMC Delhi with over three years of experience in the news room. Before joining India Today, he worked with ANI and TICE News. Born and raised in Bokaro, Sonu writes about personal finance, taxes, and stock markets. Basically, how you can make money and keep it. When heβs not simplifying budgets, heβs probably cheering for cooking or out playing some sport.
