The domestic benchmark indices witnessed sharp selling on Monday amid concerns about higher interest rate as well as rise in commodity prices as the U.S. and its western allies plan to impose fresh sanctions on Russia over its invasion of Ukraine. Adding to it, continued selling by foreign institutions and anticipation of rate hike by the central banks globally were some of the key reasons for the massive fall of Indian equities.

The BSE Sensex declined as much as 1,290 points to hit a low of 57,047 in the first two hours of the day’s trade so far. In a similar trend, the NSE Nifty fell 347 points to touch a low of 17,129.

The market witnessed broad-based selling with all sectors flashing in red, dragged down by more than 4.5% fall in IT and technology indices. The market breadth, indicating the overall strength of the BSE, was weak with 2,155 shares declining out of 3,644 traded shares. As many as 1,318 shares advanced, while 171 were unchanged.

"In the near-term, headwinds are getting stronger for the market. Globally, sentiments are negative with Dollar index above 100, 10-year yield above 2.8 percent and global economy expected to weaken if the Ukraine war prolongs. Back home in India, Infosys results came worse-than-expected with rising attrition and weakening margins even though growth prospects appear bright. IT valuations may come under pressure dragging the index down,” says V K Vijayakumar, chief investment strategist at Geojit Financial Services.

“A clear trend in the market is preference for value over growth. This trend and the outperformance of the mid-caps are likely to continue. Investors will get buying opportunities in these segments on declines," he added.

Top gainers and losers

On the BSE Sensex pack, 24 out of top 30 shares were flashing in red, barring NTPC, Tata Steel, HUL, Nestle India, Mahindra & Mahindra, and Maruti Suzuki India.

IT heavyweight Infosys was the worst performer with a 7% loss, followed by Tech Mahindra (-5.29%), Housing Development Finance Corporation (-3.90%), HDFC Bank (-3.78%), Wipro (-3.56%), among others.

Infosys shares dropped 7.5% to ₹1,617 apiece on the BSE after the country’s second-largest software exporter posted lower-than-expected earnings in the fourth quarter ended March 31, 2022. The consolidated net profit rose 12% year-on-year to ₹5,686 crore in the January-March quarter of the financial year 2021-22 while its revenue grew 22.7% YoY to ₹32,276 crore in Q4 FY22. Going ahead, the company expects revenue to grow by 13%-15% in constant currency for FY23.

Investors continued to book profit in HDFC group shares after the unveiled merger plans. Shares of mortgage lender HDFC fell nearly 7% in the past one week, while private lender HDFC Bank dropped nearly 4% during the same period.

HDFC Bank, the country’s largest private sector lender by assets, on Saturday reported 22.82% year-on-year (YoY) growth in its net profit at ₹10,055.2 crore for the fourth quarter ended March 31, 2021. The net revenues (net interest income plus others income) increased 7.3% YoY to ₹26,509.8 crore in Q4 FY22. For the full financial year ended March 2022, net profit grew 18.8% YoY to ₹36,961.3 crore, while total income climbed 7.7% YoY to ₹1.57 lakh crore during the quarter under review.

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