- Indian markets saw widespread selling amidst global weakness, crude surge.
- Broader indices fell sharply, with most sectors recording deep cuts.
- Disappointing corporate earnings and FII selling added market pressure.
Dalal Street remained firmly in bearish territory on Friday morning, with rising crude oil prices, weak global markets and disappointing corporate earnings triggering widespread selling. At around 10:40 am, the BSE Sensex was down 850.98 points, or 1.11 per cent, at 75,540.41. The Nifty 50 declined 225.85 points, or 0.95 per cent, to 23,643.75. Only seven of the 50 Nifty constituents were trading in the green, highlighting the intensity of the sell-off.
The weakness was not restricted to frontline stocks. The Nifty Bank slipped 463.35 points, or 0.82 per cent, to 56,128.65, with all 14 constituents trading lower. The Nifty Midcap 100 fell around 604 points, or 0.97 per cent, to 61,697. The Nifty Smallcap 100 declined nearly 265 points, or 1.40 per cent, to 18,671.60. The sharp fall across Mid-Cap and Small-Cap counters indicated that investors were reducing risk rather than merely rotating between sectors.
Sectoral breadth was overwhelmingly negative, with 15 of the 16 major indices trading lower. Nifty FMCG was the only index holding marginally positive, gaining 0.05 per cent as investors sought relatively defensive businesses. Nifty Pharma and Nifty MNC were relative outperformers, though they remained lower by 0.43 per cent and 0.64 per cent, respectively. The deepest cuts were seen in Nifty Realty, which dropped 1.91 per cent, followed by Nifty Auto at 1.71 per cent and Nifty Metal at 1.39 per cent.
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Nifty Energy and Nifty Commodities also lost about 0.97 per cent each as the crude oil shock raised concerns over input costs, inflation and corporate margins. Suryoday Small Finance Bank bucked the weak trend and jumped around 7 per cent after reporting an improvement in its June quarter profit. Cyient gained nearly 2 per cent following growth in quarterly earnings, although its profit came below market estimates.
On the downside, Ramco Systems plunged 10 per cent after reporting a fall in quarterly profit. InterGlobe Aviation, the operator of IndiGo, declined about 2.2 per cent after posting a Q1 net loss of Rs 237.6 crore, partly due to higher aviation turbine fuel costs. Infosys fell around 1 per cent after its quarterly net profit declined 8.6 per cent sequentially to Rs 7,769 crore. According to the latest available provisional data for July 23, foreign institutional investors sold Indian equities worth a net Rs 2,999.23 crore.
Domestic institutional investors provided nearly equal support, purchasing shares worth Rs 2,947.14 crore. Brent crude surged around 7 per cent and crossed USD 102 per barrel as escalating Middle East tensions revived fears of supply disruption. Asian markets followed Wall Street lower, with Japan’s Nikkei falling about 2.9 per cent and South Korea’s Kospi dropping nearly 3.7 per cent.
The Dow Jones had ended the previous session 0.99 per cent lower, while a stronger US dollar added to pressure on emerging-market assets. For the Nifty, 23,500 is the immediate support to watch, while a recovery above 23,800 could ease short-term pressure. Crude oil movements, Middle East developments, the rupee and ongoing Q1 earnings will remain the key triggers. Investors may be better served by tracking volatility and company-specific fundamentals rather than reacting to every Intraday move.
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(“Disclaimer: This article uses information originally published by Dalal Street Investment Journal (DSIJ). The views expressed are those of the original authors and not necessarily of ABP Network Pvt. Ltd. This content is provided for general informational and educational purposes only and should not be construed as investment, financial, legal or tax advice. Readers are advised to conduct their own research and/or consult a qualified financial advisor before making any investment decisions. This content is for informational purposes only and should not be treated as investment advice. ABP Network, its employees and associates shall not be responsible or liable for any losses or damages arising directly or indirectly from the use of or reliance on this article or any information contained herein.”)
