On Monday, the Nifty index ended on a bearish note, with most sectoral indices recording losses. Nifty PSU Bank and Nifty Metal were notably among the top decliners, falling by 3.09 percent and 1.44 percent, respectively. This downturn in the market was highlighted by Vaibhav Vidwani, a Research Analyst at Bonanza Portfolio. The BSE Sensex also experienced a significant drop of 483 points, concluding the day at 65,512, while the Nifty declined by 141 points to settle at 19,512.
The Middle East witnessed a surge in instability following an unexpected attack by Hamas on Israel over the weekend. This development, along with growing concerns about rising geopolitical tensions stemming from allegations of Iran’s involvement in the assault plot, contributed to the overall pessimism seen in both domestic and international markets.
Several factors added to the market’s gloom, including rising US bond rates, increasing crude oil prices, and foreign institutional investor (FII) selling in Indian markets. The 10-year US Treasury rates, for instance, reached an intraday peak of 4.8 percent, the highest level since August 2007. Additionally, the 30-year bond surpassed the 5 percent threshold for the first time since August 2007, according to Vidwani.
Among the Nifty’s top losers for the day were Adani Ports, Hero MotoCorp, BPCL, HDFC Life, and M&M, while HCL Technologies, Dr. Reddy’s Laboratories, TCS, Tata Consumer, and HUL emerged as the top gainers.
The overall market sentiment was bearish, with all Nifty sectors closing in the red. Major selling pressure was observed in PSU banks, metals, and consumer durables, as noted by Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services.
Investors remained cautious due to concerns about potential rate hikes following strong US jobs data and the surge in oil prices resulting from the ongoing conflict in West Asia.
“In the near term, we expect markets to remain volatile amid geopolitical stress and inflationary pressure ahead of CPI data to be released by the US, Europe, and China later during the week,” Khemka commented.