The benchmark stock market indices are trading in green at noon trade wiping off day's losses so far. BSE Sensex was up over 490 points while the broader Nifty50 was edging towards 17,300-mark. Among sectors IT and Oil and Gas indices up 1 percent each, while FMCG, PSU Bank and Realty indices down 1-2 percent.
At 1.42 PM, Sensex was up 0.86 percent or 494.11 points at 57,786.60, The Nifty50 was up 0.88 percent or 150.20 points at 17,267.80.
Earlier, the Sensex fell 265 points at around due to heavy selling pressure in FMCG and banking stocks. The 30 stock S&P BSE Sensex was trading at 57,027.27 points at 12.14 pm, which is 265.22 points or 0.46 per cent down from its previous day's close at 57,292.49 points.
In the morning trade, the Sensex opened marginally higher at 57,297.57 points and rose to 57,340.42 points in the early morning trade. However, heavy selling pressure in FMCG, banking and auto stocks dragged Sensex down to 56,930.30 points. The market is under selling pressure for the second consecutive day. The Sensex had lost 571.44 points or 0.99 per cent on Monday.
The broader Nifty 50 of the National Stock Exchange was trading 74.75 points or 0.44 per cent down at 17,042.85 points against its previous day's close at 17,117.60 points. The Nifty had lost 169.45 points or 0.98 per cent on Monday. FMCG and banking stocks fell sharply. Hindustan Unilever slumped 3.64 per cent to Rs 1976.80. Nestle India dipped 3.19 per cent to Rs 17290.
Santosh Meena, Head of Research, Swastika Investmart, said, Most of the new businesses listed entities have fallen sharply from their 52 weeks high as well as from their listing price. Riding on the euphoria of bull market run, these companies had come up with their IPO’s in 2021 at an exorbitant valuation of 30 to 50 times revenues. As stock prices tend to track the fundamentals of the underlying business, these new-age companies have got a reality check in the market because sooner or later these companies have to report profits. Investors keep making the same mistakes and it was no different during the recent IPO wave but now they have realized that chasing hot themes generally does not work. Thus investors are punishing stocks that are richly valued, lack clarity about their business model and future outlook and don’t have any solid competitive advantages. Inflation and tight supply chain conditions are forcing the hands of central banks to end an era of ultra-low interest rates and thus investors throughout the globe are losing interest towards non profitable tech stocks, he added.
