New Delhi: Indian equity benchmark Sensex fell over 700 points in early trade on Tuesday.
While the Sensex hit a low of 57,718 after the initial deal, the 30-share index was down just 95 points at 58,370 on the BSE.
Meanwhile, NSE Nifty reclaimed 17,400 mark, down 6 points.
Weak global sentiments coupled with frequent foreign fund outflows in index majors such as Infosys, ICICI Bank and Reliance Industries (RIL), resurgence of COVID-19 cases in Europe and the US, reappointment of Jerome Powell as Fed chairman There is a deficit among the factors. According to market analysts there are some major reasons for the fall.
After touching a low of 57,718.34 in the opening session, the 30-share index was trading 264.20 points or 0.45 per cent lower at 58,201.69, according to a PTI report.
Infosys, the top gainer in the Sensex pack, declined nearly 2 per cent, followed by ICICI Bank, HUL, Bajaj Auto, RIL and TCS.
On the other hand, Tata Steel, PowerGrid, Bajaj Finance and ITC were among the gainers.
In the previous session, the Sensex was down 1,170.12 points or 1.96 per cent at 58,465.89 and the Nifty was down 348.25 points or 1.96 per cent at 17,416.55.
Foreign institutional investors (FIIs) were net sellers in the capital market as they offloaded shares worth Rs 3,438.76 crore on Monday, according to exchange data.
“Market heavyweight RIL revalues Aramco deal, Paytm disastrous inventory, COVID resurgence in parts of Europe, RBI stretched valuation warnings, foreign brokerages downgrade to India and roll back of agricultural laws set off a perfect storm That rocked the market, VK Vijayakumar, chief investment strategist at Geojit Financial Services told PTI.
This is a much-needed reform that will make the market healthy, he said, adding that Paytm’s fiasco is a reality check in the primary market and will irrationally rein in enthusiastic newbie investors.
Nifty has declined 6.4 per cent from peak, while Nifty Bank has posted a decline of 12.4 per cent from peak, indicating weakness in the banking sector even though valuations in banking have not been raised. Continued selling by FIIs will keep negative sentiment in the market. The response of retail investors has to be seen for improvement,” he said.
Elsewhere in Asia, shares in Hong Kong and Seoul were trading with losses in mid-session deals, while Shanghai and Tokyo were positive. Stock exchanges in the US ended the overnight session largely in the red.
Meanwhile, international oil benchmark Brent crude fell 0.45 per cent to $79.34 a barrel.
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