Sensex plunges over 1,000 points on weak global cues; smallcaps worst hit

NEW DELHI: Inflation data released in US overnight send domestic indices tumbling on Thursday morning. The US CPI print eased to 8.3 per cent in April from 8.5 per cent in March, but was still higher than analyst estimates of 8.1 per cent, suggesting while inflation in the the world’s largest economy may have peaked, any further easing would be a slow process and that an aggressive Fed stance may continue.

The economic reading helped the dollar stay near a two-decade high, hurting emerging market equities. At 9.42 am, the BSE Sensex was trading 1,024.29 points or 1.89 per cent lower at 53,064. Nifty50 was trading at 15,865, down 301 points or 1.87 per cent. Midcap and smallcap indices lost up to 2.2 per cent.

“Negative base effects dragged YoY core CPI to 6.2 per cent in April from 6.5 per cent in March. However, firming monthly core CPI inflation suggests the underlying inflation trend remains high, adding pressure on the Fed to hasten tightening,” Nomura said in a note.

Among Sensex stocks, Mahindra & Mahindra fell 2.5 per cent to Rs 864.35. declined 2.46 per cent to Rs 1,137.60. fell 2.41 per cent to Rs 5,666.50. , , and were some other Sensex stocks, which declined over 2 per cent.

Most Asian stocks were trading in the red. The MSCI’s index of Asia-Pacific shares outside Japan declined 0.92 per cent. Japan’s Nikkei dropped 1.01 per cent, Hong Kong’s Hang Seng declined 1.05 per cent while South Korea’s Kospi edged 0.36 per cent lower.

The dollar index, which measures the greenback against a basket of six major world currencies, stood at to 103.92.

Back home, the market was also keenly awaiting the domestic CPI figures, which are scheduled for post market hours today. Nirmal Bang Institutional Equities said CPI inflation is likely to rise to 7.4 per cent in April from 6.95 per cent in March, led by higher prices of edible oil and fuel and a gradual pass-through of rise in input costs to retail prices as well as inflation in the services sector, supported by the opening up of the economy.

Provisional data suggested that foreign portfolio investors (FPIs) were net sellers of domestic stocks to the tune of Rs 3,609.35 crore on Wednesday. FPI outflows have touched Rs 17,403 crore in May and Rs 1,44,565 crore in 2022 so far.

Meanwhile, Larsen & Toubro, Tata Motors, Siemens, Honeywell Automation India, Tube Investment of India, Aditya Birla Capital, Poonawalla Fincorp, Sheela Foam, Gujarat State Petronet, Credit Access Grameen, Apollo Tyres, Brigade Enterprises, Anupam Rasayan and RBL Bank are among the companies which will announce March quarter earnings today.

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