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Benchmark share indices ended 1% lower on Thursday, amid a sell-off in late trades, after signs of an interest rate hike by the US Fed rekindled fears of foreign fund outflows from emerging markets while caution was also seen ahead of the exit polls of the Bihar elections, results of which are due on Sunday.
Further, the US Federal Reserve has revived the possibility of a December rate hike citing favourable growth in the US economy thus dampening the sentiments of the market players.
The 30-share Sensex ended down 249 points or 0.94% at 26,304 levels. The 50-share Nifty also hit its lowest level since October 1, 2015 and settled down 85 points or 1.05% at 7,955 levels
The broader markets, however, underperformed their larger peers with the BSE MidCap and SmallCap indices ending down 1.5% each. The health of the market was extremely weak with 1,798 losers and 897 gainers on the BSE.
MARKET VIEW
"Markets near term trajectory has been dominated by local cues. Investors are cautious ahead of the Bihar polls verdict," said Tirthankar Patnaik, Head of Research & Chief Strategist, Mizuho Bank
According to Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services, "Market is falling in anxiety to the Bihar exit poll prediction today. Bihar has 16 Rajya Sabha seats of which only 5 seats will retire in 2016 and this will not having any material impact on ruling government’s majority. This is unlikely to revamp the central governments capex of reforms going forward but only a sentimental impact in the near-term."
He further added, "The market expects the government’s spending and reforms to revive post the Bihar election."
RUPEE
At closing, the Indian rupee was weakened by 26 paise against the US dollar at Rs 65.74 on the back of demand from importers for the US currency. Besides, a weak opening in the domestic equity market put pressure on the rupee, dealers said.
SECTORS & STOCKS
Sectorally, all the sectors ended in red with BSE Realty and Healthcare indices slumping over 2% each. BSE Bankex index dropped heavily as well with 1.5% losses.
Metal stocks lost sheen as the Fed rate hike prospect has surfaced back. Vedanta, NMDC, Jindal Steel, Hindalco ended down between 1-5% each.
Tata Steel is expected to announce its quarterly results later today. The stock has lost nearly 3%
Banking and financial shares are bleeding on a possible Fed rate hike announcement. HDFC bank, SBI, ICICI Bank, Axis Bank are all down between 0.4-2% each.
Vedanta reported widening of its net loss to $324.5 million in the first half of the current financial year as the mining conglomerate faced challenging commodities market. The stock ended nearly 5% down.
Auto shares ended up on hopes of higher sales during the ongoing festive season following the new model launches. M&M, Maruti Suzuki, and Hero MotoCorp ended up 0.1-1% each.
Stocks such as Maruti Suzuki, Bank of Baroda, Ashok Leyland, Yes Bank, Indian Oil Corporation Ltd (IOCL) are likely to make an entry into in the MSCI India index as per Emkay, a research analyst firm.
Prime Minister Narendra Modi today launched three ambitious schemes to reduce the physical demand for gold and fish out 20,000 tonnes of the precious metal worth $800 billion lying idle with households. However, PC Jewellers, Tribhuvandas Bhimji Zaveri , Rajesh Exports all finished lower between 0.2-2% .
Pharma company Novartis India today reported a multi-fold jump in its stand-alone net profit at Rs 103.82 crore for the September quarter on back of slump sale of its OTC division to GlaxoSmithKline Plc. The stock is up 1.5%
