Stock markets close marginally lower amid higher oil prices
Benchmark stock indices Sensex and Nifty ended marginally lower on Tuesday as elevated crude oil prices and fresh US-Iran tensions weighed on investor sentiment.
After a volatile trade, the 30-share BSE Sensex ended lower by 12.99 points, or 0.02 per cent, at 76,944.28. At 3:12 pm, the benchmark was at the 76,685.48 level, down 271.79 points, but recovered most of the losses during the Closing Auction Session (CAS), which was introduced by the Securities and Exchange Board of India (SEBI) from August 3 in a phased manner.
During the day, the benchmark dropped 301.15 points, or 0.39 per cent, to 76,656.12.
The 50-share NSE Nifty slipped 24.60 points, or 0.10 per cent, to end at 24,055.80 on the weekly expiry day. The Nifty was also down almost 100 points to 23,980.55 at 3:20 pm.
Growing expectations that the US Federal Reserve could keep monetary policy tighter for longer are also weighing on risk appetite across emerging markets, an expert said.
Among the 30 Sensex firms, Maruti, State Bank of India, InterGlobe Aviation, Bajaj Finserv, Mahindra & Mahindra and Axis Bank were the major laggards.
ITC, HCL Tech, Infosys and Bharti Airtel were among the winners. Brent crude, the global oil benchmark, jumped 2.03 per cent to $92.33 per barrel. Markets are increasingly balancing India’s strong growth momentum against mounting global uncertainties.
Better-than-expected GDP growth underscores the resilience of domestic demand and the broader economy.
“However, escalating geopolitical tensions in the Middle East and a more hawkish Federal Reserve have renewed concerns about inflation and the prospect of elevated interest rates for an extended period,” Vinod Nair, Head of Research, Geojit Investments Ltd, said.
India’s economy grew at a faster-than-expected 7.8 per cent in the April-June quarter, showing resilience in the face of concerns that the war in Iran and resulting global uncertainty could weigh on domestic economic momentum.
“Indian equity markets ended marginally lower, tracking weakness across global markets as rising concerns over tighter global monetary conditions and the continuing escalation in US-Iran tensions weighed on investor sentiment.
“The sharp rebound in crude oil prices and a parallel rise in global bond yields triggered a broad-based selloff across domestic equities, with banking, realty, auto, healthcare and consumer durable stocks declining more than 1 per cent each,” Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, a Research Analyst firm, said.
The BSE MidCap Select index declined 0.60 per cent, and the SmallCap Select index dipped 0.40 per cent.
Among BSE sectoral indices, Auto dropped 1.41 per cent, Consumer Durables (1.25 per cent), Telecommunication (1.06 per cent), PSU Bank (0.86 per cent), Capital Goods (0.95 per cent), Financial Services (0.83 per cent), and Industrials (0.70 per cent).
IT jumped 1.24 per cent, Focused IT (1.16 per cent), Energy (0.94 per cent), FMCG (0.37 per cent), Utilities (0.22 per cent), and Housing Finance (0.22 per cent).
In Asian markets, South Korea’s Kospi ended higher, while Japan’s Nikkei 225, Shanghai’s SSE Composite index and Hong Kong’s Hang Seng index settled lower.
Markets in Europe were trading in negative territory. US markets ended lower on Monday.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 7,985.88 crore on Monday, according to exchange data.
On Monday, the Sensex declined 307.24 points, or 0.40 per cent, to settle at 76,957.27. The Nifty dropped 95.25 points, or 0.39 per cent, to end at 24,080.40.
