Market Falls: Sensex Down 590 Pts, Nifty Dipped 173 Pts; What Is Impacting Indian Stocks On January 8?

Stock Market Crash: Despite the shocks of the HMPV virus dulling, the Indian stock market continued to trade volatile this week, with Sensex and Nifty falling by nearly a per cent on Wednesday, January 8. The performance comes ahead of major Q3 results by tech giants such as TCS and Tata Elxsi. However, the strong US macros are seen to be weakening emerging markets.

Sensex Crashed:

Sensex nosedive by 590 points to hit an intraday low of 77,610.21 compared to the previous session's 78,199.11. The benchmark opened at 78,319.45 which was its intraday high before correcting. At the time of writing, Sensex is down by 448.42 points or 0.57% to trade at 77,750.69.

Among the major draggers of Sensex are --- Zomato, Adani Ports, SBI, Infosys, Titan, Tech Mahindra, HDFC Bank, IndusInd Bank, and Ultratech Cement which dropped by 1% to 2.5%.

However, heavyweight Reliance Industries (RIL) emerged as the star performer of the day, with gains of nearly 2%. Maruti Suzuki, M&M, TCS, Power Grid and Axis Bank were also in green.

Nifty Crashed:

The 50-scrip index plummeted by 172.55 points to hit an intraday low of 23,535.35. The index opened at 23,746.65 and touched an intraday high of 23,746.65 before correcting. In the previous session, the index was at 23,707.90.

Currently, Nifty is trading at 23,577.95, lower by 129.95 points or 0.55%.

Dr Reddy's Lab, Reliance, ONGC, BPCL and Maruti were top gainers. However, Shriram Finance, Trent, Adani Ports, Titan and SBI dragged Nifty by falling in the range of 2% to 3.5%.

Except for oil and gas, all sectoral indices were in red on Wednesday. Here are the key draggers of the market:

Consumer Durables Downfall!

Nifty Consumer Durables took the most beating from bears on Wednesday. The index plunged by 1,222.75 points or 2.9% to trade at 41,443.60. Dixon Tech, Kalyan Jewellers, Blue Star, Voltas, Amber, Titan, Whirlpool, Bata India, CERA, and Kajaria Ceramics dropped by 2% to 7%.

Bank Nifty Falls:

Another key damper for benchmarks is bearish sentiment in banking stocks. Bank Nifty dipped by 470.55 points or 0.94% to trade at 49,731.60. SBI, ICICI Bank, Federal Bank, HDFC Bank, and PNB were top losers by declining between 1% to 2%.

Financial Stocks Soured:

The mood was soured in Nifty Financial Services as well with the index dropping by 234.45 points or 1% to trade at 23,195.85. Shriram Finance, PFC, REC, SBI, ICICI Bank, Muthoot, SBI Card, HDFC Bank, ICICI General Insurance, HDFC AMC, and ICICI Prudential shed 1% to 3.5%.

Why Market Is Down Today?

Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said, The trend of strong US macros weakening emerging markets is continuing. The US 10-year bond yield has spiked to 4.67% on better-than-expected jobs numbers and indications of the services sector doing very well. This means the Fed may hold rates in January leading to further strengthening of the dollar and rising bond yields. The fall out of this on the Indian macros is that the RBI may hold rates in February against the market expectation of a cut."

He added, in this macro setting, FIIs are likely to continue selling, putting pressure on the market. Large caps, despite fair valuations, may continue to be on the defensive.

To investors, Vijayakumar said, "Investors can take a slightly long-term view of the market and buy largecaps in financials, IT, pharmaceuticals and select autos. These segments will bounce back in a few months when macros turn positive for India."