On Wednesday, the benchmark equity indices Sensex and Nifty closed lower for the third consecutive day, primarily due to selling in IT and select banking shares and foreign fund outflows. The 30-share BSE Sensex declined by 159.21 points or 0.27 per cent, settling at 59,567.80, after dipping by 274.29 points or 0.45 per cent to 59,452.72 during the day. The broader NSE Nifty ended at 17,618.75, down by 41.40 points or 0.23 per cent.
Several Sensex firms, including HCL Technologies, IndusInd Bank, Infosys, Wipro, NTPC, Asian Paints, Tata Consultancy Services, Tech Mahindra, State Bank of India, and UltraTech Cement were major laggards. On the other hand, Bharti Airtel, Mahindra & Mahindra, Axis Bank, HDFC, HDFC Bank, Bajaj Finance, and Reliance Industries were among the winners.
Asian markets also closed lower, with Japan, Shanghai, and Hong Kong settling down, while Seoul ended in the green. In Europe, equity markets were mostly trading in negative territory. The US markets had also ended mostly lower on Tuesday. Foreign portfolio investors (FPIs) offloaded equities worth Rs 810.60 crore on Tuesday, according to exchange data.
In the meantime, the global oil benchmark Brent crude declined by 2.23 per cent to USD 82.88 per barrel.
The decline in the equity indices for three consecutive days indicates weak market sentiment amid concerns about rising COVID-19 cases in some parts of the world, inflationary pressures, and the impact of the rising crude oil prices on the Indian economy. The selling in IT and select banking shares also reflects investor caution ahead of the upcoming earnings season, with some market participants expecting lower-than-expected results due to the pandemic’s impact on business operations. Additionally, foreign fund outflows may be attributed to the rising US Treasury yields and the strengthening dollar, which have made emerging markets, including India, less attractive to foreign investors.
In conclusion, the Indian equity markets’ recent decline amid negative global cues and foreign fund outflows indicates a cautious market sentiment ahead of the earnings season and rising economic concerns.
