Share Market Highlights: Sensex crashes 1400 pts, Nifty ends near 15800; ICICI Bank, Infosys top draggers

Benchmark indices ended in the red with Nifty below 15,800 on the back weak global markets. The Sensex was down 1,456.74 points or 2.68% at 52,846.70, and the Nifty was down 427.40 points or 2.64% at 15,774.40. BSE Midcap declined 2.7 percent and Smallcap index shed 3 percent. All the sectoral indices edned in the red with bank, capital goods, auto, IT, metal, IT, realty, PSU Bank, oil & gas indices fell 2-3 percent each.

"Indian equities opened with a significant gap down today, tracking weak global cues, and are seeing a sell-off after US May inflation data accelerated to a four-decade high of 8.6%, raising concerns about aggressive rate hikes by the US Federal Reserve at its upcoming monetary policy meeting on Wednesday. This month's volatility is projected to be higher than usual due to inflationary pressures, interest rate hikes, and other global economic pressures. The rupee fell to a new all-time low on Friday, as the dollar strengthened and global crude oil prices rose. India's inflation report is expected today, and investors are worried about the Reserve Bank of India's next move. If retail inflation in India continues to grow and crosses the 8% milestone, the market will become more volatile. Investors may wait until the market trend becomes clearer, but long-term investors should stay invested if they have a long-term investment plan, since a large correction will provide an opportunity for investors to purchase high-quality equities at appealing prices."

~Mohit Nigam, head — PMS, Hem Securities

Nifty IT index crashed over 4%. TCS, Infosys, LTI, LTTS plunge up to 6%

“The burgeoning losses of the downstream oil PSUs may pose severe challenges to government and investors both as (1) the government will have to balance the finances of companies, its fiscal position and inflation and (2) investors may have to increasingly worry about a return to the era of controlled prices and subsidies. Annualized impact of the two excise duty cuts in November 2021 and May 2022 is pegged around Rs2.2 lakh crore. Crude oil prices inched up last week with Brent crude trading above $120 per barrel mark. India’s macro-economic factors and investment case would weaken considerably if crude prices were to increase further given a combination of (1) top-down negative impact on inflation and interest rates, fiscal and bond yields and BoP and currency and (2) bottom-up negative impact on profitability and margins for almost all sectors. The Indian market’s valuations continue to be uninspiring, especially of consumption sectors and ‘quality’ stocks. Financials remain one of the few patches with reasonable valuations, but they too will struggle if India’s macro-economic position was to deteriorate further; credit growth may stay muted.

~Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

Nestle India, Britannia were the only Nifty 50 gainers

Benchmark indices extended losses as Sensex crashed 1700 points and Nifty 50 slipped below 15,700

"The US Inflation rate came in at 8.6% which is a 40-year high. US 10 year bond yields are ~3.187. Hence there is a huge gap of ~5.4% between the two. In order to bridge the gap, the central banks have to tame inflation by increasing interest rates. If the 10yr Bond yields in US increases to 5%, we would see balance sheets getting starched for many companies. The yields on US 2-year Treasuries have past 3% and now are trading at the highest level since 2007, and it's gap with the 10-year yields is now less than 5bps, making a case for a sharp downturn in the equities. In the last 100 years, almost all recessions have been preceded by a rising US$, rising Interest rates and rising crude oil prices. Even this time the scenario is the same."

~Sandeep Bhardwaj, CEO, IIFL Securities

“LIC, at current price it can be accumulated with at least 3 years perspective. It will remain under pressure for some more time as anchor investors will be free to exit after 16th June. But considering the relative cheap valuation at lower levels it will find interest from domestic retail and HNI investors. Institutional investor will wait for some more time before they start buying it.”

~Prasant Bhansaali, Director - Mehta Equities

Benchmark indices extended the losses and trading at day's low in the afternoon session. The Sensex was down 1,524.24 points or 2.81% at 52779.20, and the Nifty was down 440.90 points or 2.72% at 15760.90.

"The equity market has been volatile given withdrawal of accommodative monetary policy both globally and locally. The market has already priced in the rate hike hence no there was no major impact on yields post the policy last week. In fact given the shape of the yield curve and swap curve, market is already pricing in a terminal repo rate much higher than the pre pandemic level. With markets pricing in rate hikes aggressively, the 3–5-year segment on yield curve looks attractive on a risk adjusted basis. As liquidity in the system reduces and debt market gets crowded out due to increased government supply, credit spread, which has been very tight should begin to expand. This should good offer opportunity to invest in investment grade credit over the next 6-12 months."

~Sahil Kapoor, Senior Executive Vice President, IIFL Wealth

Benchmark indices continued to trade deep in red and were quoting near the day's low with Nifty around 15800 amid selling across the sectors. The Sensex was down 1,423.14 points or 2.62% at 52880.30, and the Nifty was down 408.80 points or 2.52% at 15793.

Equity investors became poorer by over Rs 5.47 lakh crore in early trade on Monday amid an extremely weak trend in the broader market with the Sensex plunging over 1,500 points. The 30-share BSE benchmark tanked 1,568.46 points to 52,734.98 in early trade. The broader NSE Nifty slumped 451.9 points to 15,749.90.