India’s stock market succumbed to selling pressure on the first day of the week due to weak global cues after comments by the US Federal Reserve Chair, wiping out more than Rs 2 lakh crore of investor wealth. However, 175 stocks climbed to a 52-week high and over 300 scrips hit the upper circuit.
The key indices recovered significantly from the day’s low. The BSE Sensex fell almost 1,500 points intraday, and lost 861 points at 57,972.62 at the close on August 29. The Nifty 50 plunged 246 points to 17,312.90.
All sectoral indices, barring FMCG, ended in red. The Nifty IT index was the biggest loser with a 3.5 percent loss.
The broader markets managed to outperform the frontliners. The BSE Midcap index was down 0.8 percent and the Smallcap index fell 0.6 percent.
Volatility increased significantly, with the India VIX rising by almost 9 percent to 19.82, making bulls more uncomfortable at Dalal Street.
US Federal Reserve Chair Jerome Powell retained the commitment to ease inflation to the 2 percent target by continuing to increase interest rates, which would bring some pain to consumers and businesses.
The European markets were down 0.7-1.8 percent at the time of writing this article, while Asian counterparts, barring China, closed sharply lower following the sharp decline in US indices on August 26.
“Investors had already got wind of the bearish undertone for the start of the week after the US Fed chairman’s speech on Friday talked about further rate hikes going ahead to tame inflation,” said Shrikant Chouhan, head of equity research (retail) at Kotak Securities.
Traders expect more bouts of volatility in coming sessions on concern that the continuation of rate hikes in the US could pose a threat to the global economy and hurt growth prospects, he added.
As a result, more than Rs 2 lakh crore of investor wealth was eroded as the BSE’s market capitalisation dropped to Rs 274.67 lakh crore, from Rs 276.96 lakh crore in the previous session.
Still, 175 stocks touched a 52-week high against 57 stocks at a 52-week low, while more than 300 stocks were at the upper circuit against over 200 scrips at the lower circuit.
Of the 175 stocks, 76 were at a new high, including Adant Transmission, Adani Total Gas, Escorts, Ingersoll-Rand, Maharashtra Seamless, Mazagon Dock Shipbuilders, Pricol, Tejas Networks, and Thermax, which are A group stocks.
In the B group, Arihant Superstructures, Axita Cotton, Data Patterns India, Kama Holdings, KPI Green, Kranti Industries, Max India, Paradeep Phosphates, Power Mech Projects, Ritco Logistics, Syrma SGS Technology, Venus Pipes, and Vinyl Chemicals India registered record highs.
Stocks that hit the upper circuit included Rama Phosphates, Essar Shipping, Prime Focus, CL Educate, DCM, Bag Films, Cinevista, Moschip Technologies, NDTV, Peninsula Land, Imagicaaworld Entertainment, and Ansal Properties and Infrastructure.Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before making any investment decisions.