Sensex tanks 800 pts, Nifty below 17,700

6 Jan 2022 , 11:33 AM

The benchmark indices were trading near the days low in mid-morning trade. Barring the Nifty Media index, all the sectoral indices on the NSE declined. Realty, IT and banks shares tumbled. At 11:30 IST, the barometer index, the S&P BSE Sensex, tumbled 800.01 points or 1.33% at 59,423.14. The Nifty 50 index dropped 226.70 points or 1.26% at 17,698.55.

Sentiment was dented by weak global cues amid a steep rise in COVID-19 infections across the globe. India reported 90,928 cases in the last 24 hours, recording a sharp spike of over 56% in daily new infections. Trading sentiment was also impacted by minutes of US Federal Reserves last meeting, which signaled the central bank may have to raise interest rates sooner than expected.

In the broader market, the S&P BSE Mid-Cap index fell 0.44% while the S&P BSE Small-Cap index lost 0.17%.

The market breadth was positive. On the BSE, 1,626 shares rose and 1,610 shares fell. A total of 132 shares were unchanged.

Foreign portfolio investors (FPIs) bought shares worth Rs 336.83 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 1,271.95 crore in the Indian equity market on 5 January 2022, provisional data showed.

Covid Update:

India has reported 90,928 cases in the last 24 hours, recording a sharp spike of over 56% in daily new infections. The country also reported 325 deaths. The Omicron tally stands at 2,630. Active caseload in India has risen to 2,85,401.

Buzzing Index:

The Nifty Financial Services index fell 1.52% to 18,058.50. The index added 7.12% in the last four trading sessions.

Shriram Transport Finance Company (down 2.58%), Cholamandalam Investment and Finance Company (down 2.46%), Kotak Mahindra Bank (down 2.14%), Housing Development Finance Corporation (HDFC) (down 2.08%) and HDFC Bank (down 1.98%) were the top losers in the Financial Services segment.

Stocks in Spotlight:

NHPC gained 1.90%. The company said that it has signed a promoters agreement with Green Energy Development Corporation of Odisha (GEDCO) for the formation of a joint venture company. The joint venture company will be formed under the name of Odisha Solar Power Development Company. NHPC will hold 74% stake in JV and the rest will be held by GEDCO. The JV will undertake development of 500 MW floating solar power projects in various water reservoirs in Odisha.

Larsen & Toubro declined 1.22%. On Thursday, the construction major announced that the companys Water & Effluent Treatment business has secured a slew of large orders from various clients. According L&Ts classification, the value of large contracts lies between Rs 2,500 crore to Rs 5,000 crore.

Foreign Market:

Asian stocks tumbled on Thursday as traders geared up for potentially tighter U.S. monetary policy.

Activity in Chinas services sector expanded at a faster pace in December, a private sector survey showed on Thursday. The Caixin/Markit services Purchasing Managers Index (PMI) rose to 53.1 in December from 52.1 in November.

Japans services sector activity expanded at a slower pace in December. The final au Jibun Bank Japan Services Purchasing Managers Index (PMI) dropped to a seasonally adjusted 52.1 from the prior months 53.0, which was the highest reading since August 2019.

Minutes from the U.S. Federal Reserves December meeting released Wednesday showed the central bank has discussed reducing its balance sheet shortly after it raises rates later this year. The minutes show officials to be considering shrinking the balance sheet along with raising rates as another way to remove policy accommodation. The Fed also signaled it could get more aggressive in raising rates.

The US stock market reacted negatively to the news on Wednesday, with stocks falling and government bond yields rising on the prospect of a tighter Fed in 2022.

Fed officials said repeatedly during the meeting that they believe ultra-easy policies instituted in the early days of the Covid-19 pandemic were no longer warranted or justified. Addressing the key pillars of their dual goals, committee members expressed concern over surging inflation while saying they see the jobs market at close to full employment.

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