Domestic equity indices fell nearly 1% on Wednesday, as the market sentiment remained negative, fearing further US Fed rate hikes. The NSE Nifty 50 tanked 184.55 pts or 1.04% to 17,642.15 and the 30-share BSE Sensex fell 603 pts or 1% to 60,069. All the broader market and sectoral indices were trading in red, except Nifty Pharma. Bank Nifty plunged 474.20 pts or 1.17% to 40,199.40 while Nifty IT sank 218 pts or 0.71% to 30,728.60. Here are the reasons why the Nifty and Sensex are falling today.
US equity market trends impacting domestic equity markets
US equity indices ended overnight session broadly lower with Dow Jones Industrial Average tanking 697.01 pts or 2.06% to 33,129.59, tech-heavy Nasdaq sank 294.97 pts or 2.50% to 11,492.30 and S&P 500 plunged 81.75 pts or 2% to 3,997.34. “The US macro data continues to dictate equity markets globally. The US markets reacted sharply negatively to the series of economic data indicating that the process of disinflation is slow and, therefore, the Fed will have to continue raising rates longer than expected earlier. This pushed up the 10-year bond yield sharply to 3.95% and stocks fell sharply. These negative US equity market trends are impacting equity markets everywhere and India cannot be an exception to this trend at least in the near term,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Markets remain volatile ahead of monthly F&O expiry
“Nifty should hold the level of 17650 intraday, however if broken, more selling is likely to continue in the coming days. Bank Nifty
Corporate earnings below analysts’ expectations
“India Inc.’s profitability moderated in 3QFY23. Corporate earnings were below our expectations during the quarter dragged by commodities while financials and autos held the fort. The broad-based slowdown in consumption, both staples and discretionary, also hit corporate earnings. The spread of earnings has been decent with 57% of our universe either meeting or exceeding our profit expectations,” said analysts at Motilal Oswal.
Investors keenly eyeing RBI MPC and FOMC minutes
Investors are waiting for RBI
Nifty 17580 level may offer a pause
“With oscillators approaching oversold territory, our downside marker of 17750 that has held so far may be expected to attract bargain buying, but a vertical bounce back is less expected. In the event of a downside break, we may expect 17580 to offer a pause, with the technical construct not yet providing for a collapse to 17300 and beyond,” said Anand James, Chief Market Strategist at Geojit Financial Services