Closing Bell: Bloodbath on Dalal Street as Sensex falls 1,939 points, Nifty settles below 14,550

Taking Stock | Sensex, Nifty Tank 4%; Investors Lose Rs 5 Lakh Crore In A Single Day

The overall market capitalisation of BSE-listed firms fell to Rs 206.18 lakh crore on February 26 from Rs 200.81 lakh crore in the previous session.... Read More

Indian equities witnessed a sharp selloff in the intraday trade on February 26 which dragged the benchmark Sensex lower by more than 2,148 points and made the Nifty go below 14,500. Banking and financial stocks led the fall as the Nifty Bank, Private Bank, PSU Bank and Financial Services indices all fell up to 5 percent.

At close, Sensex was 1,939 points, or 3.80 percent, down at 49,099.99 while Nifty was at 14,529.15, down 568 points or 3.76 percent.

Mid and small-caps were outperforming their larger peers as the BSE Midcap and Smallcap indices were down by 1.75 percent and 0.74 percent, respectively.

The market witnessed a strong downward trend and a decisive breakdown below the support level of 14750.

While a recovery above 14,850 is the key to change the short-term bearish outlook, sustaining below this level, the market will gain downside momentum and open the gate for a movement until 14,540.

The momentum indicators like RSI, MACD may turn negative and market breadth may deteriorate significantly, further strengthening the view of a short-term bearish outlook.

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: Gold prices have continued their slide from yesterday and currently trading near USD 1,757. Rising global bond yields are pushing non-yielding gold prices lower. The 10-year T-note yield surged to a 1-year high Thursday of 1.609 percent. Also, the 10-year UK gilt yield rose to an 11-month high Wednesday of 0.829 percent, and the 10-year German bund yield climbed to an 11-month high of -0.216 percent.

Gold prices are likely to trade negatively while below key resistance level around 20 days EMA at USD 1,804 and 50-day EMA at USD 1,831 while immediate support level could be seen around USD 1,740-1,716.

Equity markets opened gap down following spike in global bond yields and extended its weakness further as the session progressed. Panic in global bond markets led to sharp rise in yields which spooked investors amid fears of interest rate cycle reversal. The fall in the broader market is less severe with Nifty Midcap100 and Nifty Smallcap100 down ~2 percent. Investors have thus turned to pharma stocks amidst this market crash. This sector has been in consolidation mode so far 2021 YTD as it witnessed profit booking post sharp rally in CY20. It has also got boost from second PLI scheme being approved for the sector. The market correction might continue for some time till inflation fears ease down.

IIFL Finance on Friday said it will launch a public issue of bonds next week to raise up to Rs 1,000 crore to augment its capital base. Backed by Fairfax and CDC Group, IIFL Finance will issue unsecured redeemable non-convertible debentures (NCDs), with a base issue size of Rs 100 crore and a green-shoe option to retain oversubscription of up to Rs 900 crore, aggregating to Rs 1,000 crore, the company said in a release. The public issue of bonds will open on March 3, 2021 for the purpose of business growth and capital augmentation.

The present inflation target of 2 to 6 percent is appropriate for the next five years to ensure price stability, the Reserve Bank of India said in its report on currency and finance on February 26. The observation is significant amid speculation that the government may ask the central bank to relax inflation targets to shore up the economy.

“Threshold inflation above which growth is unambiguously impaired ranges between 5 and 6 percent in India, indicating that an inflation rate of 6 percent is the appropriate upper tolerance limit for the inflation target,” the report said.

Nava Bharat Ventures share price jumped over 5 percent after the board approved the proposal for buyback of fully paid up equity shares of face value of Rs 2 each for an aggregate amount not exceeding Rs 150 crore.

Dilip Buildcon emerges as lowest bidder for a HAM project worth Rs 1,060 crore under Bharatmala in Andhra Pradesh. The stock was trading at Rs 688.75, up Rs 22, or 3.30 percent. It has touched a 52-week high of Rs 697.