At around 11:20 am, Sensex was down 1370 points or 2.76% and fell to intra-day low of 48102, Nifty also dived to 14424 owing to mixed global cues. Also, the broader markets were performing even worse, with a drag of 4.6 percent on Nifty Midcap 100.
Here are some reasons dragging the benchmark indices lower in trade:
1. Lockdown imminent in financial hub:
The enormous cases being reported in the financial capital is now seeping into other states and with it the economic activity shall be again halted and suffer. And this stakeholders, dealers and investors in the market are taking negatively.
Moreover amid rising Covid 19 cases by a huge 1.6 lakh on a day on day basis, the pace of vaccination has moderated. Also, at the same time there has been reported non-availability of vaccines at some of the places which are being replenished.
2. Bank , realty,media drag the indices the most:
Nifty PSU Bank in a weak market traded lower by close to 8%, followed by weakness in the media and realty pack. The most drag among the PSBs come from SBI, BOB, Canara Bank, PNB and Bank of India.
3. Mixed global cues:
In the US, there has been signs of economic recovery which is at a reasonable pace, also inflation being imminent the US treasury yield being trending higher, there may be a case that money from equities may move to bonds that are considered a safer bet. Shanghai Composite, Jakarta Composite were all down by over 1 percent.
4. Quarterly numbers:
There is a strong sense that Q4 earnings will come in as the results season begins today with the IT bellwether TCS. And so dealers will be watching out whether the expectations meet results. Also, banks' asset quality will come to fore as the SC has come up with its judgement on the interest on interest waiver case..