Markets fall on recession fears in US; Nifty plunges over 200 points and the Sensex ends below 79,000; banks deep in the red

The benchmark equity indices ended Tuesday’s trading session in the negative territory. The NSE Nifty 50 dropped 208 points or 0.85% to settle at 24,139, while the BSE Sensex plunged 692.89 points or 0.87% to 78,956.03.

The broader indices ended in negative territory, with fall led by Large-cap and Mid-cap stocks. Financial Services and Banking stocks plunged over 1% among the other sectoral indices while Auto and Realty stocks shed.

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Sectoral Index

Bank Nifty index ended lower by 746.10 points or 1.48% to settle at 49,831.85. The Nifty Midcap 100 fell by 449.10 points, or 0.78%, ending the day’s trading at 49,881.50. In the broader markets, small-cap and mid-cap stocks finished in the red.

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Top Movers for the day

Titan Company, Apollo Hospitals, Tata Consumer Products, Dr Reddy’s Lab and HCL Tech were the top gainers on the NSE Nifty 50, while the laggards includes HDFC Bank, BPCL, HDFC Life Insurance, Shriram Finance, and ONGC.

The Indian Volatility Index (India VIX) closed up by 1.89 % at 16.17.

Experts on Today’s Market Performance

“The domestic market plunged into red terrain in the latter half, amidst mixed global sentiments. Recent IIP data indicates a lacklustre growth in the major manufacturing sector. Persistent selling by FIIs and elevated valuations is further contributing to the decline,” said Vinod Nair, Head of Research at Geojit Financial Services

Nair also said that Despite having minimal impact on the recent adverse developments, the market currently shifts attention towards underlying earnings growth, which remains bleak this quarter and may lead to a downgrade if resilience isn’t shown in subsequent quarters. All sectors, especially banking, metals, telecom, and fertilizers were in red, while HDFC Bank declined due to lower-than-expected passive fund inflows in the recent MSCI index rejig.

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Commenting on the same Ajit Mishra – SVP, Research, Religare Broking said that The markets continued their downward trend, losing nearly a percent as the correction phase persisted. Despite a flat start, the Nifty gradually declined, closing near the day’s low at 24,140.70. The pressure was primarily due to a drop in banking and financial heavyweights, while IT majors attempted to limit the losses. Broader indices also struggled, with declines ranging from 0.8% to 1.3%.

Mishra also added that Nifty is under pressure after failing to surpass the 20-day EMA resistance and appears poised to retest the 24,000 support zone. The decline in banking majors has disrupted the recovery, while other sectors are trading mixed. We recommend monitoring leveraged positions closely and waiting for clearer market signals.

Bank Nifty

Commenting on the Bank Nifty today Riyank Arora, Technical Analyst, Mehta Equities said that The benchmark index, Bank Nifty, has reached its immediate support level at the 49,600 mark and is holding well above it. Currently trading at 49,831, the risk-reward ratio favors buying, with a recommended stop loss set at 49,600. We anticipate a potential upside toward the 50,750 and 51,000 levels. With banking stocks positioned at critical support levels, a strong bounce-back from current levels is expected, targeting 50,750 and 51,000.

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