Bears dominated bull in the week gone by with the benchmark equity indices falling more than three per cent amid bets on the US Federal Reserve’s faster rate hikes in 2022. The 30-share BSE Sensex plunged 2,185.85 points, or 3.57 per cent, to 59,037.18 on January 21 against 61,223.03 on January 14. Likewise, the 50-share NSE Nifty index cracked 638.60 points, or 3.50 per cent, to 17,617.15 during the same period. As many as 45 stocks in the Nifty50 index settled in the red. With a fall of 12.66 per cent, HCL Technologies emerged as the top loser in the index. It was followed by Bajaj Finserv (down 10.29 per cent), Divi’s Laboratories (down 9.47 per cent), Tech Mahindra (down 8.30 per cent), Shree Cement (down 7.54 per cent) and Infosys (down 7.45 per cent).
Foreign Institutional Investors (FIIs) stood net sellers in the equity segment, with gross purchases of Rs 33,196.95 crore and gross sales of Rs 43,844.86 crore, leading to a net outflow of Rs 10,647.91 crore.
Yesha Shah, head of equity research, Samco Securities said, “Global counterparts have been experiencing declines for quite some time, and it seemed that our markets are now following the global trend, rattled by rising bond yields and oil prices. The US 10-year treasury yield and India’s 10-year government bond yield have touched their highest levels in two years at 1.90 per cent and 6.68 per cent, respectively. This rise is largely responsible for the impending triggers.” “This signifies that the markets are pricing in a Fed rate hike sooner than expected. Furthermore, the inflationary woes were worsened when benchmark oil prices soared beyond $89 per barrel, their highest level since 2014. These tremors in the domestic markets are anticipated to persist in the next week as the budget approaches. History suggested that Indian indices have posted negative returns or stayed rangebound in seven of the previous 10 years in the week preceding the Budget," Shah said. The coming truncated week is expected to be volatile for the domestic equity markets on account of the F&O expiry, which is scheduled to take place on January 27.
Trade Safely, Happy Weekend - VS
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