Domestic indices BSE Sensex and NSE Nifty-50 traded in the red as banking stocks dragged the markets into the negative territory, on the projections of the US Federal Reserve maintaining the current federal funds rate and rising Treasury yields.
At 11:47 am, the Sensex was down 346.55 points or 0.52 percent at 66,081.54, and the Nifty was down 79.10 points or 0.40 percent at 19,732.40.
About 1278 shares advanced, 1811 shares declined, and 128 shares unchanged.
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“The U.S. September retail sales were stronger than expected, raising the possibility of the Federal Reserve at least keeping interest rates higher for longer in its quest to lower inflation. Retail spending in September jumped 0.7%, beating forecasts, while economists polled by the Wall Street Journal expected a 0.2% increase,” said Deepak Jasani, Head of Retail Research of HDFC Securities.
The markets are also feeling the brunch of US Treasury yield rising. US treasury yields closed at 16- and 17-year highs on Tuesday. The 10-year Treasury note climbed 13.7 basis points to hit 4.846%, the highest close since 2007.
Stocks and sectors
Shares of Tejas Networks rallied 2 percent to Rs 895 apiece on BSE on October 18 after it inked a pact with FibreConnect for the deployment of an end-to-end optical network in Italy. Bajaj Electricals stock price gained nearly a percent after the company received a contract worth Rs 347.29 crore from Power Grid Corporation of India.
CIE Automotives India shares advanced over 1 percent to Rs 500 after the company reported a net profit of Rs 375 crore in the second quarter, marking a jump of 119 percent over the last year.
Among the laggards, ICICI Prudential Life fell more than 2 percent on October 18 after the insurer reported mixed earnings for Q2FY24 with a rise in profit but a decline in VNB margins and revenue. Biocon shares slumped 4 percent after the Indian pharma firm said that its Malaysian insulin manufacturing facility was classified as “OAI” (Official Action Indicated) by the USFDA.
The broader markets traded in the red as the fear gauge, India VIX added 1.28 percent. Sectorally, Nifty Bank, Nifty Private Bank and Nifty PSU Bank were all more than one percent lower. The outperformers were pharma, media and healthcare stocks that traded in the green amid a weak domestic market.
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