Indian Stock Markets Experience Decline Amid Middle East Tensions

Indian Stock Markets Experience Decline Amid Middle East Tensions
Indian Stock Markets Experience Decline Amid Middle East Tensions
Indian Stock Markets Experience Decline Amid Middle East Tensions
Indian Stock Markets Experience Decline Amid Middle East Tensions

Indian Stock Markets Experience Decline Amid Middle East Tensions

Indian Stock Markets Experience Decline Amid Middle East Tensions

Indian Stock Markets Experience Decline Amid Middle East Tensions

As global stock markets faced a selloff due to escalating tensions in the Middle East, Indian stock markets followed suit. The apprehensions surrounding the situation in the Middle East raised concerns among investors, resulting in a downturn in the Indian equities market.

Analysts noted that the increased yields in the United States could potentially trigger further selling of Indian stocks by foreign investors. These elevated yields, combined with global uncertainty, had a significant impact on the performance of Indian stocks.

On Thursday, foreign institutional investors (FIIs) sold stocks of Indian companies valued at ₹11,195.58 crore but purchased stocks worth ₹10,102.11 crore. This led to a net outflow of ₹1,093.47 crore, as reported by NSE data. In contrast, domestic institutional investors (DIIs) bought equities amounting to ₹7,249.75 crore while offloading shares worth ₹6,513.60 crore, resulting in a net inflow of ₹736.15 crore, according to the exchange data.

The BSE Sensex closed with a 0.38% loss at 65,629.24, while the NSE Nifty 50 index settled 0.24% lower at 19,624.70. Both benchmarks experienced a 0.81% decrease during the session.

Siddhartha Khemka, the head of retail research at Motilal Oswal Financial Services Ltd, pointed out that global factors continued to exert influence on the Indian equities market. He noted that the market opened lower but managed to recover some of its losses, closing at 19,625 points. In terms of sector performance, the Auto, FMCG, and Consumer Durable sectors were among the major gainers.

The market’s outlook remained dependent on several factors, including US Federal Reserve Chair Jerome Powell’s speech, which could provide insights into future interest rate hikes. Additionally, the ongoing Middle East situation continued to weigh on market sentiment.

Metals experienced a 0.88% decline, making it the top sectoral loser, while banks closed 0.31% lower after a 0.75% intraday loss. On a positive note, the Auto index rose by 0.50%, and the Consumer index saw a 0.14% increase.

Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd, highlighted the market’s vulnerability amidst the geopolitical tensions in the Middle East. Several factors, including the Israel-Palestine conflict, uninspiring Q2 results from Indian corporations, rising US Treasury yields, expectations of another interest rate hike by the Federal Reserve, and anticipation of Powell’s speech, contributed to the market’s prevailing pessimism.

For the Nifty, the support level was identified at 19,501, while a significant upward move would only be anticipated if the index broke the 19,887 hurdle.

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