Market wrap: Benchmarks end near four-month lows; Sensex tanks 1,190 points

Oil prices fall up to 5% as demand concerns weigh; Centre bans futures trade in seven agri commodities; Singapore index steals a march over NSE in Nifty futures volumes in 2021


MARKET WRAP | BSE Sensex | Omicron

BS Web Team  |  New Delhi 

Top headlines

· Benchmarks end near 4-month lows amid Omicron scare; Sensex tanks 1,190 pts

· Realty, metals worst hit in broad-based sell-off

· Oil prices fall up to 5% as demand concerns weigh

· Centre bans futures trade in seven agri commodities

· Singapore index steals a march over NSE in Nifty futures volumes in 2021

Frontline indices slumped to their lowest levels in 4 months as surging Omicron cases triggered tighter restrictions in Europe and threatened to be a drag on the global economy into the New Year. Besides, heavy FPI selling, dwindling rupee, concerns over slowing Chinese economic growth, and sharp sell-off in index heavyweights resulted in a bull massacre.

Globally, shares dropped and oil prices fell by 5 per cent on Covid-19 concerns and tighter monetary policies by global central banks. Futures on the Dow Jones Industrial Average dropped 1.3 per cent, while those of S&P 500 and Nasdaq 100 declined up to 1.4 per cent. In Europe, the pan-European Stoxx 600 dropped 2 per cent in early trade and Japan’s Nikkei led the losses in Asia with a 2.2 per cent fall.

Against this backdrop, Indian benchmarks settled 2 per cent lower amid across-the-board sell-off. The S&P BSE Sensex tumbled 1,190 points to close at 55,822 and the Nifty50 ended at 16,614, down 371 points.

However, the indices did stage a partial recovery during the fag end of the session to settle 1 per cent higher from the day’s lows.

According to Vinod Nair, head of research at Geojit Financial Services, the Indian markets are reaching the last phase of this consolidation in terms of price correction. Some pockets have become fair and long-term investors can buy high-quality stocks with a focus on defensive stocks and India-focused businesses.

Yash Gupta, equity analyst at Angel Broking also believes buying on dips can be a prudent strategy with a focus on defensive bets.

As regards today, BPCL ended the session as the worst performer on the Nifty index, slipping 6.5 per cent. It was followed by Tata Motors, Tata Steel, IndusInd Bank, Bajaj Finance, Coal India, SBI, ONGC, HDFC Bank, Kotak Bank and RIL. All these shares dropped between 3 per cent and 5 per cent.

The broader markets underperformed the large-cap peers with the mid-cap and small-cap indices on the BSE ending over 3 per cent lower each.

Among individual stocks, AU Small Finance, Oil India, Nykaa, Sona Comstar, RBL Bank, Mindtree, Policybazaar, and Spandana Sphoorty tumbled in the range of 6-10 per cent.

On the upside, though, the shares of Future Group’s listed companies rallied 20 per cent on the BSE after the Competition Commission of India (CCI) on Friday suspended Amazon’s 2019 deal with Future Retail (FRL).

Among sectors, the Nifty Realty index shed 5 per cent, PSB Index fell 4.5 per cent, and the Metal index tanked 4 per cent. All other sectoral indices were down up to 3.5 per cent.

In the primary market, the three-day IPO of Surpriya Lifescience has been subscribed over 67 times so far on the final day of the issue.

Meanwhile in another development, the Securities and Exchange Board of India (SEBI) has barred exchanges from launching new futures contracts in paddy (non-basmati rice), wheat, chana, mustard seeds and its derivatives, soybean and its derivatives, crude palm oil, and moong, for one year. The order, which will come into immediate effect, is meant to check rising prices of some of these commodities, mainly oilseed complexes and pulses.

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