Mumbai : Weak global cues, such as uncertainty over US presidential elections and the US Federal Open Market Committee (FOMC) decision, depressed the Indian equity markets on Wednesday, reports IANS. Both the key indices witnessed intense selling pressure and closed the day’s trade with losses of more than one per cent each.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) edged down by 112.25 points or 1.30 per cent to 8,514 points. The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 27,679.32 points, closed at 27,527.22 points — down 349.39 points or 1.25 per cent, from its previous close at 27,876.61 points.
The Sensex touched a high of 27,679.32 points and a low of 27,500.81 points during the intra-day trade. The BSE market breadth was skewed in favour of the bears — with 1,967 declines and 965 advances.
On Tuesday, the benchmark indices had closed on a flat note on the back of weak global markets, profit booking and an outflow of foreign funds.The barometer index had declined by 53.60 points or 0.19 per cent, while the NSE Nifty inched up by 0.55 points or 0.01 per cent.
Initially on Wednesday, the key equity indices opened on a negative note in sync with their Asian peers. Besides, the global markets remained cautious over the decision of the ongoing two-day US Fed’s FOMC (Federal Open Market Committee) meet.
A rate-hike can potentially lead FPIs (Foreign Portfolio Investors) away from emerging markets such as India, and is also expected to dent business margins as access to capital from the US will become expensive. Morever, investor sentiment across the global markets remained subdued ahead of the upcoming US presidential elections.
Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services, said: “Though few expect FOMC to hike rates tonight (Wednesday night), uncertainty regarding US presidential vote put global markets in a state of disarray. Domestic cues were few, and PSU (public sector unit) banks were on the backfoot as at least six PSU banks’ numbers were due for release this week.”
“The state Finance Minister’s two-day meeting on GST (Goods and Services Tax) begins tomorrow (Thursday), and bring in much warranted distraction from global cues, but with US jobs data also scheduled on Friday, little respite is expected this week,” James added.
Nevertheless, the Indian rupee stayed firm, and strengthened by one paise to 66.72 against a US dollar from its previous close of 66.71 to a greenback.
According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, the CNX Nifty traded with bearish sentiIn terms of investments, provisional data with exchanges showed that foreign institutional investors (FIIs) sold stocks worth Rs 667.37 crore, while domestic institutional investors (DIIs) bought scrip worth Rs 407.27 crore.
Sector-wise, all the 19 sub-indices of the BSE witnessed heavy selling pressure, led by healthcare, oil and gas and banking stocks.
