why market is down today: With the swearing in of the newly elected US President Donald Trump and the announcement of increasing the trade duty for Canada and Mexico by 25 percent, investors are scared at the local level. Zomato, NTPC, Adani Ports, ICICI There was an uproar in the stock market today due to the fall of about 11 percent in 27 big companies including Bank, SBI and Reliance.
BSE’s 30-share sensitive index Sensex plunged 1235.08 points or 1.60 percent to 75,838.36 points, below the psychological level of 76 thousand points, a seven-and-a-half-month low. Earlier on June 06, it was at 75,074.51 points. Also, Nifty of National Stock Exchange (NSE) fell by 320.10 points or 1.37 percent and closed at 23,024.65 points.
Like the big companies of BSE, there was heavy selling in the shares of medium and small companies, due to which midcap fell by 2.00 percent to 43,167.39 points and smallcap fell by 1.94 percent to 51,714.62 points. During this period, shares of a total of 4088 companies were traded in BSE, out of which 2788 declined while 1187 rose while 113 remained unchanged. Similarly, there was selling in 2095 companies of NSE while there was buying in 715 while 77 remained stable.
The trend of all 21 groups of BSE was negative. This led to Realty 4.22, Commodities 0.82, CD 0.82, Energy 1.25, FMCG 0.32, Financial Services 1.79, Healthcare 0.96, Industrials 2.11, IT 1.16, Telecom 2.52, Utilities 2.35, Auto 1.68, Banking 1.81, Capital Goods Shares of 2.16, Consumer Durables 3.99, Metal 0.82, Oil & Gas 0.69, Power 2.63, Tech 1.21, Services 2.86 and Focused IT group fell 1.17 percent.
Trends in foreign markets remained mixed. During this period, Britain’s FTSE rose by 0.15 percent, Japan’s Nikkei by 0.32 percent and Hong Kong’s Hang Seng by 0.91 percent, while Germany’s DAX fell by 0.15 percent and China’s Shanghai Composite fell by 0.05 percent.
Boom in initial business: In early trade, Sensex opened with a rise of 188 points at 77,261.72 points and due to strong buying, it reached the highest level of 77,337.36 points by afternoon. Due to selling, it fell to a low of 75,641.87 points in the last phase of trading. In the end, it fell by 1.60 percent to 75,838.36 points as compared to the previous day’s 77,073.44 points.
Nifty also down: Similarly, Nifty also opened with a rise of 77 points at 23,421.65 points and remained at a high of 23,426.30 points and a low of 22,976.85 points during the session. Finally, it closed at 23,024.65 points, 1.37 percent weaker than the previous session’s 23,344.75 points.
Shares of these companies fell: During this period, except HCL Tech and UltraSimco, which rose by 0.76 percent, the rest of the Sensex companies declined. Zomato suffered the maximum loss of 10.92 percent. Similarly Adani Ports 3.74, NTPC 3.51, ICICI Bank 2.98, SBI 2.57, Reliance 2.46, Mahindra 2.17, Bajaj Finance 2.03, Tech Mahindra 2.00, Axis Bank 1.87, Tata Motors 1.84, Tata Steel 1.52, Kotak Bank 1.36, Power Grid Shares of 1.35, Bajaj Finserv 1.10, IndusInd Bank 1.06 and TCS fell 1.04 percent. Apart from these, shares of Bharti Airtel 0.93, Asian Paint 0.90, LT 0.87, Maruti 0.79, Infosys 0.74, Sun Pharma 0.69, Nestle India 0.61, HDFC Bank 0.58, Titan 0.51, Hindustan Unilever 0.21 and ITC were weak by 0.11 percent.
1. Uncertainty about Donald Trump’s trade policy
US President Donald Trump has threatened to increase tariffs on many countries including India. Their visa policies may also impact the Indian technology sector. Trump has announced to impose 25 percent tariff on Canada and Mexico. He also has a slant on India. Its effect was visible on the Indian market today.
2. Signs of weakness in the Indian economy
There are signs of weakness in the Indian economy, due to which there is an atmosphere of caution in the market. The pace of GDP has slowed down to its lowest level in two years. There is no increase in demand in the market. This is also affecting market sentiment.
3. Cautious stance regarding the budget
The country’s budget will be presented on 1 February. After Trump, investors are now eyeing the budget. Any disappointment in expectations could further blow the already weak market sentiment. This also affected the market.
4. Weak results of the quarter
After the decline in the first and second quarter earnings of the companies, there has been no significant improvement in the December quarter earnings too, with mixed trends seen across various sectors.
5. Selling by foreign investors
Amid the strengthening of the US dollar and increase in bond yields, foreign portfolio investors (FPIs) are continuously withdrawing money from the Indian market. This is one of the major reasons for the decline in the Indian stock market in recent months. Edited by: Sudhir Sharma
