Indian equity markets saw early losses as investors adopted a cautious stance ahead of the US Fed’s interest rate decision, with major stocks like Reliance and HDFC Bank witnessing selling pressure.
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Indian equity markets saw a sharp decline in early trade on Tuesday, with benchmark indices Sensex and Nifty both witnessing losses. The fall was largely attributed to investor caution ahead of the Federal Reserve's interest rate decision and ongoing selling in major blue-chip stocks such as Reliance Industries and HDFC Bank.
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The Sensex, which tracks 30 of the largest and most actively traded stocks on the Bombay Stock Exchange (BSE), dropped by 350.98 points to 81,397.59 in early trade. Similarly, the NSE Nifty, which represents the National Stock Exchange, fell by 100.8 points to 24,567.45.
Among the stocks leading the decline were major players like Reliance Industries, Bharti Airtel, Nestle, Larsen & Toubro, Bajaj Finserv, HDFC Bank, JSW Steel, and Titan. These stocks have been facing significant selling pressure, contributing to the overall downturn.
On the other hand, some stocks managed to hold their ground and posted gains, including Tata Motors, Adani Ports, Tech Mahindra, HCL Technologies, and Hindustan Unilever. These stocks provided some support to the broader market, although the overall sentiment remained subdued.
The cautious trading sentiment in Indian markets was mirrored in Asian equities as well. Seoul, Shanghai, and Hong Kong markets were all trading lower, reflecting the global uncertainty. However, Tokyo's market managed to stay in positive territory, offering a slight counterbalance to the overall trend.
Wall Street, in contrast, ended the previous day with a mostly positive trend, providing a mixed backdrop for Indian investors.
According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, markets are closely watching the Federal Open Market Committee's (FOMC) meeting outcome. With a 25 basis point rate cut already largely factored into expectations, investors are now focusing on the Fed chair's commentary. Any deviation from a dovish tone in the statement would be viewed negatively by the markets, although this remains a low-probability event.
In addition to these concerns, Foreign Institutional Investors (FIIs) continued to offload equities, with net sales worth Rs 278.70 crore recorded on Monday, as per exchange data.
Global oil prices also experienced a dip, with Brent crude down by 0.14 percent to $73.81 per barrel, which added to the overall cautious sentiment in the markets.
On Monday, the markets had already faced some declines, with the Sensex dropping 384.55 points or 0.47 percent, closing at 81,748.57, while the Nifty lost 100.05 points, or 0.40 percent, to settle at 24,668.25.
(With inputs from PTI)
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