Moneycontrol PRO
Open App
Upcoming Event : Traders Conclave 2022 | India's Largest Retail Stock Investors & Traders Residential Conclave

Taking Stock | Sensex tanks 861 points, Nifty ends below 17,350 as Fed's hawkish stance bites

Tech Mahindra, Infosys, Wipro, HCL Technologies and TCS were among the major Nifty losers

August 29, 2022 / 06:16 PM IST

The Indian equity markets closed deep in the red on August 29 on weak global cues, spooked by the aggressive stance taken by the US Federal Reserve to tame inflation that triggered fresh worries about interest rate hikes.

At Close, the Sensex was down 861.25 points, or 1.46 percent, at 57,972.62, and the Nifty was down 246 points, or 1.40 percent, at 17,312.90.

Tech Mahindra, Infosys, Wipro, HCL Technologies and TCS, which count the US as one of its biggest markets, were among the major Nifty losers.

The gainers included Britannia Industries, Maruti Suzuki, Apollo Hospitals, Nestle India and Asian Paints.

"Powell’s hawkish tone during the Jackson Hole symposium pointed towards a stricter rate hike while investors were expecting a milder policy action post the release of the softer July inflation reading," said Vinod Nair, Head of Research at Geojit Financial Services.

Close

The Fed's stance has worsened concerns about an economic slowdown, which caused a significant selloff in the US market with the spillover roiling markets around the world.

"The sell-off in emerging markets like India was exacerbated by concerns over the possible withdrawal of foreign funds, which was the backbone of the recent market rally," he added.

On the sectoral front, Nifty Bank, information technology, metal, and PSU bank shed 1-3 percent. Some buying was seen in FMCG names.

IndexPricesChangeChange%
Sensex58,098.92-1,020.80 -1.73%
Nifty 5017,327.35-302.45 -1.72%
Nifty Bank39,546.25-1,084.35 -2.67%
Nifty 50 17,327.35 -302.45 (-1.72%)
Fri, Sep 23, 2022
Biggest GainerPricesChangeChange%
Divis Labs3,642.6062.50 +1.75%
Biggest LoserPricesChangeChange%
Power Grid Corp202.55-17.55 -7.97%
Best SectorPricesChangeChange%
Nifty Pharma12610.65-2.25 -0.02%
Worst SectorPricesChangeChange%
Nifty PSU Bank3053.70-126.20 -3.97%

Also Read: Sensex, Nifty plunge; 5 factors pulling the market down

Stocks and sectors

On the BSE, apart from FMCG and oil & gas, all sectoral indices ended in the red. Bank, information technology, metal and realty were down 1-3 percent.

Broader indices outperformed the main indices, with BSE midcap and smallcap indices falling 0.5 percent each.

A short build-up was seen in Info Edge, City Union Bank and Tech Mahindra, while a long build-up was witnessed in Escorts, India Cements and Colgate Palmolive.

Among individual stocks, a volume spike of more than 200 percent was seen in Britannia Industries, Colgate Palmolive and Oracle Financial Services Software.

More than 150 stocks touched their 52-week highs on the BSE. These included Venus Pipes & Tubes, Rushil Decor, New Delhi Television, ITD Cementation India, Escorts Kubota, Bharat Electronics and Adani Transmission.

Also Read Reliance Industries AGM 2022 | Plan to accelerate Rs 75,000 crore investment in new energy: Mukesh Ambani

Outlook for August 30

Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas

The Nifty had seen a minor degree bounce in the last week that retraced nearly 61.8 percent of the first leg of the fall. Structurally, the index was gearing up for a down move. Accordingly, the index had a huge gap down opening on August 29.

On the way down, the index breached the swing low of 17,345, which got retested with an intraday bounce. Though the index witnessed some recovery, it is unlikely to sustain.

The level of 17350-17400 is the immediate resistance zone, where the index is likely to attract another round of selling. Overall, the short-term target continues to be pegged at 17,000.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

The market was expected to be weak after the US Fed chairman on August 26 talked about further rate hikes to tame inflation. The Sensex crashed nearly 1,500 points in the early trade before recovering some ground to close off the day's low.

Traders are expecting more bouts of volatility in the coming sessions on concerns that the continuation of rate hikes in the US could pose a threat to the global economy and hurt growth prospects.

Technically, the Nifty closed below the 20-day simple moving average (SMA), which is broadly negative.

For the Nifty, 17,400 and 17,450 will act as important resistance zones and 17,250 could be the support zone. Below it, the index can slide to 17,150-17,100. On the flip side, the index can move up to 17,450-17,500 if it manages to cross 17400.

Disclaimer: The views and investment tips expressed by 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 taking any investment decisions.
Rakesh Patil
first published: Aug 29, 2022 03:54 pm
Sections
ISO 27001 - BSI Assurance Mark