The Indian benchmark indices continued the sell-off for the fifth straight session on Monday as weak global cues and economic uncertainties caused by the fresh wave of the Covid-19 pandemic dented market sentiment. Caution prevailed in the market ahead of a two-day U.S. Federal Reserve’s policy meeting starting Tuesday, and the Union Budget 2022 slated to be tabled in the Parliament early next week.

Extending fall for the fifth session, the BSE Sensex crashed as much as 2,053 points, or 3.5%, to hit an intraday low of 56,984, while the NSE Nifty50 nosedived 619 points, or 3.5%, to touch day’s low of 16,998. Paring some of early losses, Sensex closed 1,545 points, or 2.62%, lower at 57,491, with all 30 index heavyweights in red. In a similar fashion, the Nifty ended at 17,112, down by 504 points, or 2.86%.

The BSE Sensex has plummeted 3,816 points over the last five sessions, while the Nifty50 declined 1,193 points during this period.

"Markets have been correcting in the last few days on the back of fears of interest rate hikes across the developed economies plus the ongoing tapering of stimulus. Though the Covid-19 numbers are still something to ponder on, but Omicron variant not being as severe has made market believe that the days of easy liquidity seem to be nearing an end. Nasdaq has corrected by around 14% which has taken the sheen away from very good IT numbers and guidance locally,” says Devang Mehta, Head - Equity Advisory, Centrum Wealth.

“More than index correction, this round of volatility has made lot of good businesses correct, which should ideally be utilised as an opportunity in adversity. An approach to buy quality franchisees and market leading businesses gradually or in tranches will ensure that you take advantage of volatility, as we approach the Union Budget amidst the ongoing third quarter result season," Mehta added.

Sectoral indices bleed in red

All the sectoral indices settled in negative terrain, with realty, metal, auto, IT, power, pharma indices falling between 2.6%.

The BSE realty index emerged as the biggest loser by ending 5.94% lower, led by Sunteck Realty, Sobha, Godrej Industries, Indiabulls Real Estate, and DLF. The realty sector was followed by the metal index, which closed down by 5.03%. The worst performers across the metal index were Jindal Steel & Power, JSW Steel, Tata Steel, Hindalco Industries, and Steel Authority of India (SAIL), which dropped up to 7%.

Top losers

All 30 stocks of the BSE Sensex closed in red, while biggest casualties were Tata Steel, Bajaj Finance, and Wipro. Tata Steel, the country’s largest steel maker, was the worst performer with 6% loss, followed by Bajaj Finance and Wipro, which dropped 5.97% and 5.35%, respectively. Some of the other notable losers include Tech Mahindra, Titan Company, Reliance Industries, HCL Tech, Bajaj Finserv, Asian Paints and Kotak Mahindra Bank, which fell up to 5%.

Shares in news

Reliance Industries: Shares of the country’s most valued firm by market capitalisation dropped 4% in line with the broader market even after reporting strong earnings for the December quarter of the current fiscal. The billionaire Mukesh Ambani-led company on Friday reported 37.9% growth in consolidated net profit to ₹20,539 crore for the quarter ended December 31, 2021, compared with ₹14,894 crore in the year-ago period. The oil-to-telecom conglomerate notched a 52.2% rise in revenue to ₹2,09,823 crore in Q3FY22, as against ₹1,37,829 crore in the corresponding quarter of FY21.

YES Bank: Shares of private sector lender ended 2.2% lower. The bank on Saturday reported a 77% YoY surge in consolidated net profit at ₹266 crore for the third quarter ending December 31, 2021, the highest since December 2018. However, total income dropped to ₹5,632.03 crore from ₹6,408.53 crore in the same period last fiscal.

Bandhan Bank: The share price of the private sector lender rose 3.7% after it posted 36% year-on-year growth in net profit at ₹859 crore in the October-December quarter compared with ₹632.6 crore in the year-ago period.

ICICI Bank: The private bank’s share price fell 0.8% despite reporting over 25% growth in net profit for the December quarter, aided by lower provisioning and higher net interest income. The net profit surged to ₹6,193.81 crore in Q3FY22, from ₹4,939.59 crore in the same quarter of the corresponding year.

Vodafone Idea: Share price of the debt-laden telecom plunged 8% after its consolidated loss widened to Rs 7,230.9 crore for the third quarter ended December 2021, compared to a loss Rs 4,532.1 crore in the same period a year ago.

Global markets follow Wall Street lower

In the overseas market, shares in the Asia-Pacific region closed mostly lower on Monday, tracking weak cues from Wall Street. The market sentiment was dented by rise in the U.S. Treasury yields and crude oil prices which reignited fears about spiking inflation and tightening of U.S. monetary policy.

South Korea’s KOSPI emerged as the biggest loser in the region by falling 1.5%. It was followed by the Hang Seng index in Hong Kong, which plunged 1.24%.

In a similar trend, Indonesia Jakarta Composite shed 1%, while Thailand’s SET Composite dipped 0.74%. The Straits Times Index in Singapore fell 0.35%, while the ASX 200 index ended 0.5% lower.

Bucking the trend, Japan’s Nikkei 225 index ended 0.24% higher, paring early losses, while Taiwan Weighted Index rose 0.5%.

In mainland China, Shanghai Composite and Shenzhen Component gained 0.04% and 0.37%, respectively.

Meanwhile, European stocks were trading lower in early trade, extending loss for the third day on looming fear of potential rate hike by the U.S. Federal Reserve. Germany’s DAX shed 1.7% in early trade, while France’s CAC index plummeted 1.6%. In a similar trend, the U.K.’s FTSE 100 index declined 1%, while Spain’s IBEX index nosedived 1.9%.

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