Dear
Trader…
The 30-share BSE Sensex fell 886 points, or 1.08%, to settle
at 80,982, while the broader NSE Nifty Future plunged 332 points, or 1.33%, to
close at 24,700.
Meanwhile, the market capitalisation of all listed companies
on BSE fell by Rs 4.56 lakh crore to Rs 457.06 lakh crore.
All major sectoral indices logged losses except for pharma
and healthcare. Nifty realty, auto, metal, and IT were hit the hardest, falling
between 2% and 3.5%. The broader, domestically focused Nifty Smallcap100 and
Nifty Midcap100 dropped 0.8% and 1%, respectively.
Nifty futures opened at 24824 points against the previous
close of 25032 and opened at a low 24670 points. Nifty Future closed with an
average movement of 447 points and a decline of around 332 points and closed 24700
points…!!
Here are top factors behind the selloff: –
Decline
in US Markets – The Indian equity market followed the correction
in US markets after US stocks tumbled on Thursday due to weak manufacturing
data, which raised doubts about the U.S. economy and countered optimism about
potential Federal Reserve interest rate cuts. On Thursday, The Dow Jones
Industrial Average fell 1.57% to 40,200, the S&P 500 lost 1.76% to 5,424,
and the Nasdaq Composite lost 2.76% to 17,114.
In early Asian trading hours, U.S. stock futures
continued to decline, with Nasdaq futures tumbling 1.5% and S&P 500 futures
falling 0.9%.
Asian Markets – Asian shares slid after
weaker-than-expected US factory data sparked fears of a worsening economic
outlook. Japan’s Nikkei share average fell nearly 6% on Friday to post its worst
session in more than four years, as fears of a US slowdown and uncertainties
over the Japanese central bank’s tightening path soured appetite for risk
assets.At the close, the Shanghai Composite index was down 0.92%, the biggest
one-day loss since July 23. The blue-chip CSI300 index was down 1.02%. The Hang
Seng index finished down 2.08%.
Geopolitical
Tension – Geopolitical tensions also weighed
on sentiment after the Israeli military said on Thursday that Mohammed Deif,
the head of Hamas’ military wing, was killed in an Israeli airstrike in Gaza
last month, following the death of the group’s political leader, Ismail
Haniyeh, in Tehran the previous day. hese developments have added pressure to
crude oil prices, which have risen over 2% in the last three days. Crude oil
prices are crucial for global inflation.
U.S.
Nonfarm Payrolls – Focus now turns to the closely
watched U.S. nonfarm payrolls report later on Friday for further clues on the
health of the labour market and the broader economy. Increasing nonfarm
payrolls numbers may show economic expansion but may also give investors reason
to be concerned about inflation; decreasing numbers suggest a broader economic
concern.
Rise
in oil prices – Oil prices rose on Friday amid concerns over
potential supply disruptions in the key Middle East production region. Brent
crude futures gained 46 cents, or 0.6%, to $79.98 a barrel, while U.S. West
Texas Intermediate crude futures rose 51 cents, or 0.7%, to $76.82.
Missing
trigger in earnings –The June quarter earnings season has so far been
in line but analysts say there were no major positive surprises to take the
market higher.Q1FY25 results, so far, indicate earnings beats and in-lines
exceeding the misses by a ratio of 1.9:1 (beats: 26; in-lines: 23; misses: 26) for
the NSE200 universe. Banks, financial services (ex-banks and NBFC’s), IT, FMCG
and oil & gas saw higher beats and in-line earnings; pharma, ement and
metal sectors saw misses.
Technically, the
important key resistances are placed in Nifty future are at 24700 levels, which
could offer for the market on the higher side. Sustainability above this zone
would signal opens the door for a directional up move with immediate
resistances seen at 24979 – 25008 levels. Immediate support is placed at 24606 –
24474 levels.
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in securities market are subject to market risks. Read Disclaimer and related
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