Benchmark Indian indices opened in the red, losing more than one percent each. The Sensex crossed the 900-point mark, while the Nifty fell below its 200-DMA level, leaving investors Rs 3 lakh crore poorer. All Nifty sectoral indices were in the red on Friday morning.
On Thursday too, the Sensex shed nearly 550 points, with the 30-stock index falling to 1,450 in two straight sessions.
Why is the stock market down today?
Weak global symptoms
In Asia, markets in Hong Kong, Shanghai, Tokyo and Seoul fell after losses in US stocks. Hong Kong’s Hang Seng fell by 2.45 percent, South Korea’s Kospi by 1.21 percent, Shanghai by 1.15 percent, and Japan’s Nikkei by 1.36 percent.
In the US, the S&P 500 fell 1.8 percent, the Dow Jones Industrial Average fell 1.7 percent and the Nasdaq Composite fell 2.1 percent, as investors worried about the possibility of the Federal Reserve acting more aggressively to fight inflation with higher interest rates. rates, PTI reported.
“Indian markets have taken a significant hit as a result of weak global cues. The US market was under pressure as shares of SVB bank and cryptocurrency financier Silver Capital fell, particularly in banking and financials. We lack direction and are currently under high levels of selling pressure as a result of highly volatile global cues for a prolonged period,” said Santosh Meena, Head of Research, Swastika Investmart.
“The latest issue is specific to the US and has only a sentimental impact on markets around the world. However, the market is likely to be volatile depending on the US jobs data released today and the US CPI readings due next week,” he added.
SVB shares fell 60%
Shares of SVB Financial Group, a US bank that invests in early-stage startups, tumbled 60% amid concerns about its financial stability, wiping out more than $80 billion in market capitalization. While this is a U.S.-specific issue, the rout is having ripple effects not only on other Wall Street stocks, but around the world.
FIIs become net sellers
According to NSE data, foreign institutional investors’ (FIIs) buying value was Rs 7,570.52 crore in Indian stocks on Thursday, while selling value was Rs 8,132.30 crore. Taking this into account, the total FII outlay for the day was Rs 561.78 crore.
Fed Fear
Markets are currently pricing in a 78 percent chance the US Fed will raise rates by 50 basis points (bps) at its March 21-22 meeting. Investors awaited Friday’s February employment data, which will help decide how high the U.S. Fed will raise interest rates at its next meeting in two weeks.
Rs
The rupee depreciated by 8 paise to 82.14 against the US dollar in early trade today. The dollar index, which shows the greenback’s strength against a basket of six currencies, was above the 105 mark.
Great technique
On the daily chart, Nifty developed Bearish Engulfing pattern on Thursday and further bearishness will be confirmed if Nifty closes in red today. Ameya Ranadive, equity research analyst at Choice Broking, said Nifty’s key levels are support at 17,350 and 200 EMA at 17,684.
Bank Nifty
Parth Nyathi, Founder, Tradingo said, “Banknifty is facing resistance at the 50-DMA, which is placed around 41,650. It is trading below the 20-DMA of 40,950, where 40,450 is the next support level. 40,000 is a critical demand area for any significant weakness.”
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