Sensex falls 143 points, Nifty below 22,900 as crude oil weighs on markets

Benchmark equity indices surrendered sharp early gains to close lower for the second consecutive session on Wednesday, dragged down by selling in banking, financial and power stocks amid elevated crude oil prices, firm US bond yields and persistent foreign investor outflows.

The 30-share BSE Sensex declined 143.21 points, or 0.19 per cent, to settle at 73,709.69, with 19 constituents ending in the red, 10 advancing and one remaining unchanged.

The index had opened on a positive note and surged 829.29 points, or 1.12 per cent, to an intraday high of 74,682.19 before noon. However, aggressive profit-booking erased the gains, pulling the benchmark down more than 1,450 points from its peak to a day's low of 73,229.45.

Some buying towards the close helped the Sensex recover part of its losses.

The broader NSE Nifty fell 77.60 points, or 0.34 per cent, to finish at 22,811.35. During the session, the index touched a high of 23,120.90 and a low of 22,702.85.

𝗣𝗿𝗼𝗳𝗶𝘁-𝗯𝗼𝗼𝗸𝗶𝗻𝗴 𝗵𝗶𝘁𝘀 𝗯𝗿𝗼𝗮𝗱𝗲𝗿 𝗺𝗮𝗿𝗸𝗲𝘁𝘀

Market analysts attributed the reversal to profit-booking following the early rally, coupled with concerns over rising energy costs, inflationary pressures and sustained foreign institutional investor selling.

"Markets witnessed a sharp reversal on Wednesday, surrendering early gains amid profit booking and persistent macroeconomic concerns," said Ajit Mishra, Senior Vice-President, Research, Religare Broking.

He said selling pressure was particularly severe in the broader market, with midcap and smallcap indices declining between 1.5 per cent and 2.4 per cent, reflecting widespread risk aversion.

The BSE SmallCap Select Index declined 2.29 per cent, while another smallcap select index fell 1.46 per cent.

Among sectoral indices, BSE Capital Goods recorded the steepest decline of 2.9 per cent, followed by Industrials at 2.44 per cent, Power at 2.23 per cent, MidSmall Private Banks at 2.02 per cent and Consumer Discretionary at 1.92 per cent.

Utilities and Services also ended lower, declining 1.76 per cent and 1.61 per cent, respectively.

In contrast, technology stocks provided some support, with the BSE Focussed IT index rising 2.63 per cent and the IT index gaining 2.46 per cent.

𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹, 𝗮𝘂𝘁𝗼 𝘀𝘁𝗼𝗰𝗸𝘀 𝗱𝗿𝗮𝗴

Among Sensex constituents, Bajaj Finance, Eternal, Trent, Axis Bank, NTPC, Maruti Suzuki India, IndiGo, Kotak Mahindra Bank, Bharat Electronics, Bajaj Finserv, Tata Steel, Titan and State Bank of India were among the major laggards.

HCL Technologies, Infosys, Tech Mahindra, Tata Consultancy Services, UltraTech Cement, Bharti Airtel, PowerGrid, Reliance Industries, ITC, ICICI Bank and Sun Pharmaceuticals ended higher.

Vinod Nair, Head of Research at Geojit Investments, said Indian equities gave up strong early gains as elevated crude oil prices and continued foreign investor selling overshadowed optimism surrounding India-US trade negotiations.

He said profit-booking intensified across automobiles, financial services, metals and real estate amid concerns over inflation and corporate margins.

However, information technology stocks demonstrated relative resilience, supported by improving earnings visibility and renewed investor interest.

𝗝𝗶𝗼 𝗜𝗣𝗢 𝗱𝗿𝗮𝘄𝘀 𝘀𝘁𝗿𝗼𝗻𝗴 𝗱𝗲𝗺𝗮𝗻𝗱

Meanwhile, Jio Platforms' Rs 30,213-crore initial public offering received overwhelming investor interest on its opening day, with the issue subscribed 3.01 times by 5 pm.

Investors bid for 59.44 crore shares against 19.75 crore shares on offer, with qualified institutional buyers leading demand.

The country's largest public offering achieved full subscription within 100 minutes of opening for bidding.

Shares of parent company Reliance Industries ended marginally higher after rising as much as 2.64 per cent during the session. 

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The Economic Times

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𝗖𝗿𝘂𝗱𝗲 𝗼𝗶𝗹, 𝗯𝗼𝗻𝗱 𝘆𝗶𝗲𝗹𝗱𝘀 𝘄𝗲𝗶𝗴𝗵

Brent crude, the global oil benchmark, crossed USD 111 per barrel, rising 2.23 per cent and adding to concerns over inflation, import costs and corporate profitability.

Antu Eapen Thomas, Senior Research Analyst at Geojit Investments, said elevated crude prices were increasing inflationary and margin pressures, while weak market breadth indicated that investors were using rallies to reduce exposure.

He said a sustained recovery would require easing crude oil prices, US bond yields and geopolitical tensions.

Sunny Agrawal, Head of Fundamental Research at SBI Securities, said positive global cues and optimism surrounding the India-New Zealand free trade agreement had supported the market at the opening, but selling intensified as the session progressed.

Foreign Institutional Investors had sold equities worth Rs 1,148.64 crore on Monday, while Domestic Institutional Investors purchased shares worth Rs 3,201.19 crore, according to exchange data.

𝗔𝘀𝗶𝗮𝗻 𝗺𝗮𝗿𝗸𝗲𝘁𝘀 𝗲𝗻𝗱 𝗺𝗶𝘅𝗲𝗱

Asian markets closed on a mixed note, with South Korea's Kospi and Japan's Nikkei 225 ending higher, while Hong Kong's Hang Seng and Shanghai's SSE Composite declined.

European markets were trading higher on Wednesday, following gains on Wall Street in the previous session.

In the preceding trading session on Monday, the Sensex had declined 876.37 points to 73,852.90, while the Nifty fell 257.20 points to 22,888.95.

Analysts said investors would continue monitoring crude oil movements, foreign portfolio investment flows, the rupee and corporate earnings for indications of market stability.