The stock market began the trading week on Monday in red. The key equity benchmark indices, Sensex and Nifty, continued to drag down as investors remained cautious ahead of the Q3 earnings lined up for the week. Further, muted global trends and consistent foreign fund outflows impacted the sentiment in the market.
Around 9:50 AM, the BSE Sensex plunged more than 700 points to fall near 76,650, while the NSE Nifty50 tanked over 200 points and close to 1 per cent to test 23,200 in the session.
On the 30-share Sensex platform, IndusInd Bank, Axis Bank, TCS, Hindustan Unilever, NTPC, and Infosys emerged as the only gainers. On the other hand, Zomato, Adani Ports, Tata Steel, HDFC Bank, and M&M stood among the laggards in the session so far.
In the broader markets, all the indices remained in the negative territory. The VIX, volatility index, climbed close to 7 per cent in the morning market hours. The Nifty Next 50 dominated among the laggards and plunged 1.79 per cent in the session.
Sector-wise, the Nifty Realty index painted red and nosedived 2.89 per cent in the session. Other major laggards included the Consumer Durables and Metal indices, which declined 1.76 per cent and 1.63 per cent respectively.
Rupee Crashes
The Indian currency depreciated 23 paise on Monday to hit record lows in early trade. The rupee reached a lifetime low of 86.27 against the US dollar, weighed down by a strong American unit and volatile global cues. Forex traders noted that a record jump in crude oil prices, consistent outflow of foreign capital, and a negative trend in domestic equity markets added more pressure to the domestic currency.
Macro Data
The foreign institutional investors (FIIs) dumped Indian equities worth Rs 2,254.68 crore on a net basis on Friday, according to exchange data. Brent crude, the global oil benchmark, rallied 1.44 per cent to reach $80.91 per barrel in futures trade, while crude soared 1.62 per cent to $81.05 a barrel.
V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, explained, “Market will continue to be under pressure from the many strong headwinds. The blow out jobs data from the US with 2.56 lakh job creation in December against expectations of 1.65 lakh means the rate cut expectations in 2025 is now down to one. With the unemployment in the US down to 4.1 per cent, the economy doesn’t need any stimulus. This good economic news is turning out to be bad news for markets which were discounting many rate cuts this year. For India, the Brent crude rising to USD 81 is a concern. But the IIP data for November at 5.2 per cent indicates that the economy is recovering from the slowdown in Q2.”
