Bloody Monday! Markets nosedive amid Russia-Ukraine tension; Sensex near 57k, Nifty 50 below 17,040; Banks worst hit; TCS shines above all; HDFC, Tata Steel, SBI top bears

14 Feb 2022 , 10:20 AM

Indian markets were bleeding in red during Monday’s early trade due to weakening in global markets as concerns over the Russian invasion of Ukraine fuels panic profit booking and crude oil reaching a multi-year high. A broad-based sell-off was witnessed across indices on exchanges BSE and NSE with Sensex diving to near 56,600-level and Nifty 50 even reaching near 16,900-level.

Except for heavyweight TCS, bears took control of all stocks listed on BSE Sensex. The performance also comes after major Q3 earnings like ONGC and India’s factory output that has clocked to a 10-month low. Further, investors now await India’s CPI inflation data for January month which will be announced later today.

At around 9.59 am, Sensex was trading at 57,010.01 nosediving by 1142.91 points or 1.97%. The index has touched an intraday low of 56,612.07.

Nifty 50 performed at 17,038.15 lower by 336.60 points or 1.94%. The benchmark has clocked the day’s low of 16,916.55.

On the broader markets, on BSE, Midcap and Smallcap dipped by nearly 510 points and 700 points respectively. Sensex Next 50 slipped over 990 points.

In terms of sectoral indices, on BSE, the Bankex was the worst hit with a drop of nearly 1,230 points with Consumer Durables following by plummeting 1,003 points. The Metal and Auto index dropped over 605 points and 630 points. Meanwhile, the FMCG, Industrial and Finance index shed between 2-3%. The IT index unlike its counterparts held a steady grip amid broader bearish markets as heavyweight TCS outperformed the markets.

Except for TCS, all stocks listed on Sensex was under selling pressure. TCS jumped over 2.5% after the board fixed the record date for its Rs18,000cr buyback programme.

Bears on Sensex were HDFC and Tata Steel dived nearly 3.7% each, while SBI, IndusInd Bank and ICICI Bank plunged over 3% each. Stocks like M&M, Ultratech Cement, Bharti Airtel, Kotak Bank, Bajaj Finserv, Maruti Suzuki, HDFC Bank, Dr Reddy’s Lab, L&T, Bajaj Finance and Axis Bank fell between 2-3%.

Other stocks like ITC, NTPC, HUL, Power Grid, Titan, RIL, Nestle, Wipro, Asian Paint and Tech Mahindra tumbled between 1-2%.

Stocks Coal India, Eicher Motors, Grasim Industries, SpiceJet, Adani Enterprises, Adani Wilmar, Rossari Biotech, AGS Transact Technologies, Bharat Dynamics,  Natco Pharma and NBCC (India) were in focus ahead of their Q3 earnings.

India’s IIP has touched a 10-month low in December 2021. IIP or factory output stood at 0.4% in the month under review on the back of contraction in manufacturing, capital goods and consumer durables output. Also, the unfavourable base effect dragged the output as well.

On the global front, Asian markets slipped with BSE Sensex taking the most beating. Japan’s Nikkei 225 dropped over 2.1%, while Hong Kong’s Hang Seng and South Korea’s KOSPI index shed 1.25% and 1.7%. China’s Shanghai Composite index dipped over 0.6%.

Also, other markets in Asia were weak except for the Australian S&P index which traded well in the green on positive data. Chinese stocks may see contrarian buying as data from manufacturing shows growth momentum returning.

Globally, markets mood has been soured due to tensions escalating in Russia and Ukraine. It is being known that an estimated 100,000 troops of Russia have buildup along Ukraine’s border. Although, Moscow denies plans to invade Ukraine, however, the major economies opt for a diplomatic push to bring a solution. Russian President Vladimir Putin earlier stated that the US failed to meet his demands. In the latest development, German Chancellor Olaf Scholz will be travelling to both countries for diplomatic talks. The German Chancellor will visit Ukraine later today and Russia on Tuesday. Also, countries like the US, UK and Germany have asked their citizens to leave Ukraine as soon as possible further sending a dampening appetite for equities.

Apart from the Russia and Ukraine tension, investors were also nerve-wracked about rising inflation and aggressive interest rate hikes by US Fed, while a decline in Eastern Europe could intensify price pressure fears if energy supplies are impacted on the Russian front.

Last week on Friday, on Wall Street,   US markets were in a free fall for another day as geopolitical tension with Ukraine/Russia added to weakness in sentiment. Dow Jones falls another 500 points 2nd day running while Nasdaq falls 394 points or 2.8%. Bond yields close near 1.93% while US$ hits 96 as oil climbs to 7-year highs.