Mumbai, Dec 10 (IANS) A global sell-off along with caution ahead of the Assembly election results and a rise in crude oil prices suppressed the key Indian equity indices deep into the red on Monday.
At the end of the day’s trade, the Nifty50 on the National Stock Exchange (NSE) fell below the 10,500 mark and the S&P BSE Sensex climbed down from the psychologically significant level of 35,000 points.
In the initial trade hours, the key indices – the S&P BSE Sensex and NSE Nifty50 – had a gap-down opening and subsequently shed over 750 points and 215 points each on an intra-day low basis.
The Nifty was dragged lower due to weakness in index pivotals Reliance Industries, Kotak Mahindra Bank, HDFC and Infosys.
Market observers said that caution prevailed before the outcome for the Assembly election results which will be known on Tuesday in Rajasthan, Madhya Pradesh, Chhattisgarh, Telangana and Mizoram.
Exit polls say the Bharatiya Janata Party is facing a tough challenge. The elections are seen as a crucial indicator of public mood before the Lok Sabha elections in 2019.
In global markets, crude oil prices rose on Monday after the Organization of Petroleum Exporting Countries and Russia on Friday agreed to reduce supplies from January 2019.
In addition, there was a spike in trade war concerns after China on Sunday summoned US Ambassador Terry Branstad over the US arrest warrant for Huawei’s global CFO Meng Wanzhou, who was taken into custody in Canada last week.
Major Asian markets closed on a negative note while European indices like FTSE 100, DAX and CAC 40 traded in the red.
Index-wise, wider NSE Nifty50 closed lower by 205.25 points or 1.92 per cent to 10,488.45 points.
The barometer 30-scrip Sensitive Index (Sensex), which opened at 35,204.66 points, closed at 34,959.72 points — lower by 713.53 points or two per cent — from its previous session’s close of 35,673.25 points.
It touched an intra-day high of 35,246.97 and a low of 34,915.77 points.
“Markets ended with hefty losses on Monday as selling pressure continued during the day after a weak opening. The weakness came on the back of weak global cues amid rising tensions between the US and China as well as disappointing Chinese trade data for November,” said HDFC Securities Retail Research Head Deepak Jasani.
Said Geojit Financial Services Head of Research Vinod Nair: “Investor’s sentiment turned fragile due to worries over slowing global growth and caution ahead of the final outcome of state elections.”
“Unfavourable exit poll results for the ruling party has impacted the sentiment of the market,” Nair told IANS.
On the currency front, the Indian rupee weakened to 71.34 against the US dollar from its previous close of 70.81 on last Friday.
In terms of investment, provisional data from the BSE showed that foreign Institutional Investors (FII) bought stocks worth Rs 116.22 crore, whereas the Domestic Institutional Investors (DII) sold shares worth Rs 145.80 crore,
Sector-wise, there were no gainers on the BSE.
On the other hand, the S&P BSE banking index plunged 605.06 points, the capital goods index fell 373.31 points and the consumer durables index was down 262.46 points.
The top gainers on the Sensex were Coal India, up 0.76 per cent, at Rs 238.60 and Maruti Suzuki, up 0.49 per cent, at Rs 7,350.10.
In contrast, the major Sensex losers were Kotak Mahindra Bank, down 6.56 per cent, at Rs 1,198.15; Reliance Industries, down 3.95 per cent, at Rs 1,088.50; Adani Ports, down 3.85 per cent, at Rs 359.35; Asian Paints, down 3.48 per cent, at Rs 1,272.70; and Tata Motors, down 3.45 per cent, at Rs 156.85.
Other major companies that slipped during the day’s trade were Tata Motors DVR, down 3.25 per cent, at Rs 86.25; Bharti Airtel, down 3.16 per cent, at Rs 294.30; Sun Pharma, down 3.03 per cent, at Rs 398.85; Larsen and Toubro, down 2.29 per cent, at Rs 1,366.45; and HDFC, down 2.21 per cent, at Rs 1,909.20 per share.