Mumbai: selling globally – triggered by the spread of the omicron variant of the Covid virus, the US Fed’s decision last week to end an easy money policy in March and a recent step by the Bank of England (BOE) to raise interest rates – LEDs for Sensex crashing Nearly 1,200 points on the close of trading Monday.
The reliance industry and financial stocks lead a decline.
In a mid-session, Sensex fell by almost 1,900 points, but the pull-back rally helped him close at 55,822 – loss of 1,190 points or 2.1%.
Close that day is the lowest level of the fourth month for Sensex.
Last week, the US Fed said it would end the bond purchase program, which began in early 2020, in March 2022.
The US Central Bank added that it would raise interest rates at least three times, from almost zero level now.
Also last week, in a surprise step, the BOE raised interest rates.
It leaves investors throughout the world anxious because the decision can cause a situation of increasing levels that compete among countries.
Combined with it, the rapid spread of omicron variants and its impact on markets and economics around the world makes investors be careful, said market participants.
According to the Securities Head (Equity Research – Retail) Shrikant Chouhan, selling in the domestic market “continues in the spectrum of weak global cues weighed by factors such as the increase in Omicron cases in the West, the rate of rate hike by several central banks in Europe and The US Fed also signifies his intention to increase interest rates next year to cool inflation fears “.
Short-term prospects for the market are still negative but, because the oversold situation, there is a strong possibility of meaningful pull-back rally, he said.
The familiar letter made more poor investors with almost 7 lakh crore rs with BSE market capitalization now at Rs 255.5 Lakh Crore.
At the current level, MCAP India is around RS 18 lakh crore from a high level of all time RS 273 Lakh Crore, official data shows.
Slide in the wealth of investors has occurred despite several new lists in recent months such as Nykaa, Paytm and Policybazaar, who together add more than Rs 4 Lakh Crore to BSE’s MCAP.
As in the past few weeks, Monday’s sales were led by foreign funds that recorded the net outflow of RS 3,565 Crore.
So far this month, foreign portfolio investors (FPI) have clean stocks sold more than RS 19,100 Crore, data from CDSL and BSE shows.
Tuesday can watch other loss sessions as the leading market in the US opened in red.
The government bond market also saw strong sales on Monday with a 10-year gold-generated benchmark at 6.44%, said 21-month bond dealer.
Cellular comes in the midst of increasing concerns about inflation, they said.