Stock Market Today: Equity markets settled near the low point of the day as investors chose to stay on the sidelines ahead of the US Federal Reserve’s monetary policy outcome on Wednesday. The benchmark S&P BSE Sensex fell 498 points, or 0.89 per cent, to end at 55,268, while the broader Nifty50 shut shop at 16,484, down 147 points or 0.88 per cent.
Infosys, HUL, Axis Bank tanked between 3 per cent and 3.5 per cent, while Dr Reddy’s Labs, Kotak Bank, Bajaj Auto, Wipro, Divis Labs, Eicher Motors, and Tata Consumer Products, shed over 2 per cent each. On the upside, Bajaj twins, JSW Steel, Grasim, and Bharti Airtel were the top gainers.
In the broader market, the BSE MidCap and SmallCap indices dropped over 1 per cent each. All the sectoral indices closed in the negative zone with the Nifty IT index falling nearly 3 per cent, followed by the Nifty FMCG index (down 1.5 per cent).
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: “The dark cloud on the global economic horizon is the threat of an imminent US recession impacting global economic growth. Jury is still out on whether the US slips into a recession or not. But a global growth slowdown appears inevitable. Wall Mart’s profit warning issued yesterday is an indication of the difficult days ahead for corporate earnings. Europe is the weakest geographical space in the world and China is struggling. Even though the Indian economy is resilient now, global growth slowdown will impact India too. This means, from the fundamental perspective, there is a limit to market upside. The 1400 point rally in Nifty from its June lows has again stretched market valuations. Therefore, FIIs might again turn sellers to rallies.”
Global Cues
Asian shares wobbled on Tuesday and bonds were firm as a profit warning from Walmart put consumption and company earnings under a cloud ahead of what is likely to be another sharp US interest rate hike. MSCI’s broadest gauge of Asia stocks outside Japan meandered just above flat. Japan’s Nikkei fell 0.2 per cent and S&P 500 futures were down 0.4 per cent.
Tokyo’s key Nikkei index zigzagged between positive and negative territory at the open on Tuesday, with investors cautious ahead of a key Federal Reserve decision The benchmark Nikkei 225 index edged up 0.01 per cent, or 3.58 points, to 27,702.83 in early trade, while the broader Topix index inched up 0.09 per cent, or 1.82 points, to 1,945.03.
The S&P 500 see-sawed on Monday and ended close to unchanged as investors girded for an expected rate hike at a Federal Reserve meeting this week and earnings from several large-cap growth companies. The Nasdaq ended lower, and S&P 500 technology and consumer discretionary led declines among major S&P sectors. The energy sector gained along with oil prices.
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