Sensex Crashes To New 52-Week Low, As Fed Hikes Cause Market Tremors

Benchmark indices, the Sensex and the Nifty came crashing down in trade, as a US Fed hike of 75 basis points in interest rates left global markets nervous about a recession.

The Sensex ended the day lower by a whopping 1045 points, while the Nifty fell 331 points in trade. Metal stocks were the worst impacted on fears of an economic slowdown and likely recession. Stocks like Tata Steel, Hindalco and Coal India saw big losses of nearly 6%. The only silver lining for the markets was falling crude prices.

Nifty opened with a gap up but failed to hold at higher levels and drifted lower. On daily scale it has broken its important support zone of 15735 and is witnessing aggressive selling pressure. "India VIX is up near 22 zones which indicates volatility likely to continue and it needs to cool down for stability in the market. Now as long as it is below 15500 zone we can expect lower levels of 15350 and 15000 whereas resistance is faced near to 15735 and 15888 zones. Market breadth is negative which indicates that the bears are dominating and facing resistance at higher levels. Today, we have witnessed weakness across sectors including Metals, Realty, Media, Pharma, Auto, Banking, IT and FMCG," a note by Technical and Derivatives Research, MOFSL said.

Bank Nifty opened with a gap up in line with Nifty but couldn't sustain at higher levels and drifted lower.

It has breached the low of last 3 trading sessions and forming a bearish engulfing candle on the daily scale indicating aggressive selling pressure. "Now as long as it holds below 32750 zones we can expect a move towards 32000 zones whereas resistance are placed at 33000 and 33500 zones.

"Today, we are witnessing long built up in stocks like Maruti, ICICI Bank, UBL, Crompton and Deepak Nitarte etc. while short build-up is visible in counters like Coalindia, Navin fluorine, AuBank, Polycab, Ramcocem etc.

Nifty is expected to trade with negative bias and can utilise any bounce as a selling opportunity till it holds below 15735 zone. At current juncture, we are advising to be with selective stocks and one can look for selling opportunity in Ultratech, Voltas, JSW Steel, Laurus Labs etc," the note further added.