US Rate hike chances depresses markets; BSE Sensex down 142 Points
Mumbai, Dec 4: Heightened chances of a US rate hike, coupled with negative sentiments emanating out of the Chennai floods, depressed Indian equity markets and led a barometer index to shed 142 points or 0.55 percent during the mid-afternoon trade session on Thursday.
Initially, both the bellwether indices of the Indian equity markets opened on a negative note following weak Asian markets.
Furthermore, sentiments’ were depressed following flooding in Chennai, that has impacted automobile and information technology (IT) industries’ centres which are located there.
Besides Chennai floods, the upcoming key US-based macro economic data — the non-farm payrolls figures are causing global volatility and impacting the Indian markets.
Even the slow movement on getting key economic legislations passed during the ongoing winter session has investors’ spooked.
The barometer 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE) declined by 142 points or 0.55 percent.
Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) was trading in the red. It was lower by 51.05 points or 0.65 percent at 7,813.10 points.
The Sensex of the BSE, which opened at 25,810.06 points, was trading at 25,744.94 points (at 1.45 p.m.), down 141.68 points or 0.55 percent from the previous day’s close at 25,886.62 points.
The Sensex has so far touched a high of 25,810.06 points and a low of 25,644.35 points during the intra-day trade.
On Thursday, the Sensex of the BSE closed 231.23 points, or 0.89 percent down following heightened chances of a US rate hike and the lower-than-expected stimulus package from the European Central Bank (ECB) through its bond buying program.
Analysts elaborated that the markets continued to trade in the red after Thursday’s comments made by US Federal Reserve (US Fed) chairperson Janet Yellen which heightened the chances of a US rate hike in mid-December.
“Thursday’s comments’ by US Fed chairperson Yallen and the upcoming US jobs data has caused uncertainty and made investors’ reluctant to chase prices,” Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
“The flooding in Chennai has also had a negative impact on sentiment due to the presence of large automobile and IT clusters’ in the area.”
Nitasha Shankar, vice president for research with YES Securities said: “Indian market continue to decline for third day in a row taking cues from weakness across the globe.”
“Weakness is seen across all major sectors barring the metal and pharma stocks, which are bucking the trend. Banking and tech stocks continue to witness powerful selling pressure.”
Sector-wise during the day’s trade, healthcare and metal indices gained, while banking, automobile and IT indices came under selling pressure.
The S&P BSE healthcare index gained by 141.79 points and metal index was higher by 40.42 points.
The S&P BSE banking index receded by 138.02 points, automobile index declined by 118.29 points and IT index decreased by 92.92 points. (IANS)