Benchmark indices began the trade on Monday on a weak note amid a bearish trend in global markets. The concerns over more rate hikes by developed economies have caused the market to drop, as fresh foreign fund outflows and a weak trend in IT counters have dented investor sentiments. The BSE Sensex declined 354.81 points to 59,109.12, while the NSE Nifty slipped 107.4 points to 17,358.40. The biggest laggards in the Sensex pack were Infosys, Tata Motors, Tech Mahindra, HCL Technologies, Wipro, Tata Consultancy Services, Tata Steel, and Maruti. Meanwhile, NTPC, Nestle, ICICI Bank, and State Bank of India were among the gainers.
Asian markets in South Korea, Japan, China, and Hong Kong were also trading lower, while the US markets had ended sharply down on Friday. Prashanth Tapse, Research Analyst, and Senior VP (Research) at Mehta Equities Ltd, said that “caution is likely to remain the buzzword as concerns over more rate hikes by developed economies in the wake of stubbornly high inflation levels continue to weigh on investors’ minds.”
Moreover, the global market construct is unfavorable, with sharp cuts in the US last Friday following the 0.6 per cent month-on-month inflation in January. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said that “with FII selling gathering pace, the market has turned distinctly weak.” Foreign Portfolio Investors (FPIs) offloaded shares worth Rs 1,470.34 crore on Friday, and foreign investors have pulled out Rs 2,313 crore from Indian equities so far this month.
The drop in the market comes as a result of concerns over the US Federal Reserve’s plans to raise interest rates and inflation concerns. Investors are worried that the rising interest rates will slow down economic growth, and high inflation rates will impact corporate earnings. The market is expected to remain cautious, and investors are advised to keep an eye on global markets and economic data.
