Mumbai, Feb 28 (IANS) Global cues — especially the prospects of higher interest rates in the US — along with a rise in fiscal deficit subdued the Indian equity markets on Wednesday.
Market observers said the domestic equity indices mimicked their Asian peers which traded in the red following US Federal Reserve Chairman Jerome Powell’s comments on the rate hike trajectory.
However, a mild pullback rally which was led by the expectations of a healthy GDP figures for the third quarter of 2017-18 arrested the downward slide.
The barometer 30-scrip Sensitive Index (Sensex) of the BSE closed at 34,184.04 points, down by 162.35 points or 0.47 per cent from its previous close of 34,346.39 points.
Similarly, the wider Nifty50 of the National Stock Exchange (NSE) edged lower during the day’s trade session. It receded by 61.45 points, or 0.58 per cent, to close at 10,492.85 points.
In the intra-day, the S&P BSE Sensex touched a high of 34,302.74 points and a low of 34,076.45 points.
“The weakness came on the back of weak global cues after hawkish comments from US Federal Reserve chair Jerome Powell on Tuesday,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.
“Nifty finally ended 0.58 per cent lower at 10,493 per cent. Broad market indices like the BSE Mid Cap index fell less, thereby outperforming the main indices. Market breadth was negative on the NSE/BSE.”
Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS: “Hawkish comments from US Fed Chairman spooked the Asian indices and weak set of deficit numbers, made the trade day a negative one.”
As per Vinod Nair, Head of Research, Geojit Financial Services: “Weak global market on account of Feds hawkish view on future rate hike and extension of selling in banks continued to impact the market.”
On the currency front, the Indian rupee weakened by 31 paise to close at 65.18-19 against the US dollar from its previous close at 64.87-88.
In terms of investments, provisional data with the exchanges showed that foreign institutional investors sold scrip worth Rs 1,750.52 crore, while domestic institutional investors purchased stocks worth Rs 1,596.89 crore.
“FIIs are sellers in the market due to domestic headwinds and is adding pressure on INR. Nifty is consolidating near the recent low while 10 yr yield is still floating at higher levels keeping investors cautious,” Nair added.
Sector-wise, S&P BSE banking index receded by 273.64 points, metals index by 186.53 points and capital goods index by 125.50 points.
However, IT index rose by 105.94 points.
Major Sensex gainers on Wednesday were: Infosys, up 2.26 per cent at Rs 1,174.25; Asian Paints, up 0.78 per cent at Rs 1,118.85; State Bank of India, up 0.35 per cent at Rs 268.75, Hero MotoCorp, up 0.35 per cent at Rs 3,600.55 and PowerGrid, up 0.28 per cent at Rs 198.45.
The Sensex losers were: Hindustan Unilever, down 2.02 per cent at Rs 1,316.35; ICICI Bank, down 1.92 per cent at Rs 313.50; Sun Pharma, down 1.75 per cent at Rs 535.35; Axis Bank, down 1.47 per cent at Rs 529.60; and Yes Bank, down 1.47 per cent at Rs 322.25.