The 30-share pack Sensex declined 304.48 points or 0.53 percent to close at 57,684.82. Its broader peer NSE Nifty fell 69.85 points or 0.40 percent to 17,245.65
After opening on a high in early trade on Wednesday, bears took control of the market during the day, leading to benchmark indices ending in red on closing. Inflationary pressures, prospects of steep interest rate hikes and rising crude oil prices dented investor sentiment.
The 30-share pack Sensex declined 304.48 points or 0.53 percent to close at 57,684.82. Its broader peer NSE Nifty fell 69.85 points or 0.40 percent to 17,245.65.
“The bullish momentum seen in early trades suddenly lacked conviction on the buy-side as the bears took control of day’s session. The street will spy with one big eye if Nifty is able to weather overbought technical conditions on the daily charts, hawkish tunes from the Federal Reserve, and the spike in oil prices,” said Prashanth Tapse, Vice President (Research), Mehta Equities.
Higher crude prices have kept domestic investors on edge as they make the world’s third-largest importer and consumer of oil susceptible to high inflation, while also pushing up the country’s trade deficit and hurting the rupee. Moreover, state-owned fuel retailers hiked fuel prices for the second consecutive day on Wednesday.
“Volatility has continued to be the mainstay as the market is aware of some perils that could quickly snowball into a serious crisis going ahead. Despite some greenshoots in the form of FIIs turning net buyers in recent trades, investors remain wary of the Ukraine conflict, rising US yields, and fluctuating crude oil prices which can turn the tables,” said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.
In Mumbai trading, the Nifty Financial Services Index fell 0.88 percent, with non-banking financial company HDFC ending as the top percentage loser on the Nifty 50.
The Nifty Auto index ended 1.04 percent lower, with two-wheeler maker Hero MotoCorp falling as much as 4 percent after income tax department officials visited two of its offices and the residence of the chief executive officer.
The Nifty Metal Index added 1.21 percent, with aluminum and copper producer Hindalco Industries being the top Nifty 50 percentage gainer.
“On intraday and daily charts, the Nifty is holding a higher bottom formation but at the same time, it is consistently facing resistance near 17440. For the traders, the Nifty support has shifted to 17200 from 17000. We expect the level of 17350-17440 if the index succeeds to trade above 17200. On the flip side, dismissal of 17180 may intensify further weakness up to 17100-17040,” said Chouhan.
(With Inputs From Reuters)