Sensex slips 0.58% to close below 58,000
NEW DELHI : As ripple effects from the US banking crisis and fears of financial contagion continued to pressure the markets, the BSE Sensex lost 0.58%, failing to hold the 58,000 mark. While Sensex closed at 57,900.19, the Nifty shed 0.65%, ending lower for the fourth day in a row and closing at 17,043.30 on Tuesday, erasing ₹2.2 trillion of investor wealth, as foreign portfolio investors (FPIs) sold provisional ₹3,086.96 crore.
Weak sentiment around banks meant banking sector indices led the decline, with IT, realty and metal sectors adding to the pressure, as all indices apart from pharma ended with losses. Reliance Industries for the second day in a row saw fresh 52-week lows of ₹2,269.05 during intraday trades. Most of Adani Group stocks fell while Adani Enterprise and Adani Ports and Special Economic Zone were down 7.27% and 3.92%, respectively, as risk-off sentiments prevailed. Adani Group bonds also saw yields rise across tenures during intraday trading in global markets. Domestic indices saw roller coaster ride with more global uncertainty, said experts.
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“The fallout of SVB and Signature Bank has somewhat rattled investors’ sentiments in the last few sessions, and with the prospect of a further rate hike already on the cards, the mood continues to be cautious with a negative bias,” said Shrikant Chouhan, head of equity research (retail), Kotak Securities Ltd.
Nifty, which slipped below the 17,000 mark briefly during intraday trades, saw a marked recovery.
Technically, Nifty can find support between 17,000 and 16,800 levels, said Chouhan.
The anticipation of a bounce back comes as benchmark indices hover over crucial supports–17,000 for Nifty and 39,500 for Bank Nifty. However, more bearish bets were added to Nifty and Bank Nifty derivatives as the indices fell, underscoring fears fanned by the collapse of three US tech-focused banks.
The only positive fallout of the SVB crisis is that the US Federal Reserve may go slow on rate hikes and the markets will remain watchful till the next Fed meeting on 22 March, said experts. Market participants now expect a rate hike of 25 basis points or, perhaps, no hike.
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