IANS | 17 Aug, 2023
Adding to the negative sentiment in stock markets, the rupee
depreciated to near a 10-month low at 83.14, while the FII outflow of
almost of Rs 10,000 crore in August so far also led to selling at higher
levels, said Siddhartha Khemka, Head of Retail Research at Motilal
Oswal Financial Services.
Domestic equities continued to witness
pressure amid weak global cues. While Nifty opened lower and remained in
the negative territory throughout the session to close with a loss of
100 points (-0.5 per cent) at 19,365 levels, Sensex was down 388.40
points or 0.59 per cent at 65,151.02.
However, action shifted to
the broader market with the Nifty midcap 100 up 0.2 per cent and the
Nifty smallcap 100 up 0.1 per cent. Except for PSU banks and consumer
durables, all sectors ended in the red.
Indian equities succumbed
to global volatility following the hawkish tone of the FOMC minutes
meeting and worries over the risk of a downgrade in China’s sovereign
credit rating by Fitch, Khemka said.
Vinod Nair, Head of Research
at Geojit Financial Services, said the mounting influence of weak global
cues hindered the domestic market's ability to recoup, resulting in
sustained selling pressure. The release of Fed minutes unveiled a
divided stance among its members regarding the necessity of additional
rate hikes, contrasting the previously anticipated rate pause.
“Concurrently,
the Indian rupee experienced a decline due to the dollar index
surpassing 103.5; however, likely intervention from the RBI offered a
degree of support. Moreover, the escalation of US bond yields is
expected to limit the influx of foreign investments into the Indian
market, further impacting market dynamics," he added.
Around 1,777
shares rose, 1,696 fell, and 152 remained constant. ITC, LTIMindtree,
Divis Lab, Power Grid, and Reliance Industries were among the top losses
on the Nifty, while Adani Ports, Titan Company, Adani Enterprises,
Bajaj Auto and SBI were among the top gainers, said Omkar Kamtekar,
Research Analyst, Bonanza Portfolio.
Due to a strong dollar and sluggish domestic markets, the rupee dropped to a new 10-month low.
In July, India's inflation rate was 7.44 per cent, up from 4.87 per cent in June with a prediction of 6.4 per cent.
”We expect the rupee to trade with a bearish bias due to global risk aversion and a strong US dollar," Kamtekar said.
