Read Business Desk. Selling is being seen in the Indian stock market today for the fifth consecutive trading day. Investor sentiment has weakened due to geo-political tension, weak rupee and no progress in talks between America and Iran. Sensex fell by more than 350 points in early trade, while Nifty slipped below 24,300. Selling pressure was most visible in government banks and IT stocks.
At 9:53 am, Sensex was trading 307.56 points, or 0.39%, down at 77,701.69. Whereas Nifty 50 was at 24,303.45 with a decline of 62.55 points or 0.26%. During trading, Sensex fell by 368.86 points to 77,640.39 and Nifty fell by 85.15 points to 24,280.85. That is, the fluctuations in the market were quite sharp in the initial trading.
4 big reasons for market decline
- Investors' concerns increased due to US-Iran tension
At present, no concrete progress has been made regarding peace talks between America and Iran. Along with this, the movement of oil tankers through the strategically important Strait of Hormuz has also not become normal.
Uncertainty related to the Strait of Hormuz may affect global oil supply. This is the reason why investors are adopting a cautious approach at present and there is selling pressure in the shares.
- rupee weakened
The weakness of the rupee has also increased the concerns of the market. Rupee opened 5 paise weaker at 95.48 against the dollar.
The rupee came under pressure after RBI reduced the cutoff date of FCNR-B Deposit Swap Window from September 30 to August 31. A weak rupee can especially affect import costs and the sentiment of foreign investors.
- Heavy selling in IT and PSU banks
Today, maximum pressure was seen on IT Stocks and Government Banks i.e. PSU Banks in the market. The Nifty index of both the sectors fell by more than 1% in early trade.
In contrast, Nifty Auto was up by more than half a percent, while Nifty Pharma was also seen trading with gains.
- Keep an eye on Market Volatility
Amidst market fluctuations, India VIX also remains an important indicator for investors. However, at the time of the data, India VIX was down 2.38% at 11.58.
The VIX is generally considered an indicator of potential market volatility. A rise in this may indicate an increasing possibility of greater volatility in the market, while a fall may indicate relatively less volatility.
24,200 important support for Nifty
According to domestic brokerage firm Bajaj Broking, the level of 24,200 is important as immediate support for Nifty. The brokerage estimates that Nifty may currently consolidate in the range of 24,200 to 24,700.
If Nifty goes below 24,200 then levels of 24,000 to 23,800 could be the next important support zone. On the upside, the market may face the next challenge around 24,700.
pressure for the fifth consecutive day
With today's fall, there is selling pressure in the domestic stock market for the fifth consecutive trading day. At present, investors are keeping an eye on Global Geopolitical Situation, movement of Rupee, Oil Prices and signals from foreign markets.
In such an environment, sector-wise performance in the market has also become very important. While selling in IT and PSU Banks is increasing pressure on the index, sectors like Auto and Pharma are trying to control the market to some extent.
Follow the LALLURAM.COM MP channel on WhatsApp