India's equity benchmark indices experienced a downturn in early trade on Tuesday, influenced by weak trends in Asian markets and a continuation of foreign fund outflows. This decline comes as investors chose to book profits following a recent sharp rally in the markets.
The 30-share BSE sensex is down by over 500 points and is trading at 71,764, while the Nifty saw a decrease of over 100 points, settling at 21,613. Notable declines were observed in major firms such as UltraTech Cement, Mahindra & Mahindra, Infosys, Asian Paints, HCL Technologies, and Larsen & Toubro. However, some companies like Sun Pharma, Bharti Airtel, Reliance Industries, Bajaj Finserv, and Power Grid managed to secure gains amidst the overall downturn.
Raghvendra Nath, managing director at Ladderup Wealth Management, said, "Since the markets have factored in all the positives in the one-sided rally over the last two months, we could see some selling pressure at record high levels."
The negative trend was mirrored in other Asian markets, with Seoul, Shanghai, and Hong Kong all trading lower. It's noteworthy that Asian, European, and US markets were closed on Monday in observance of the New Year.
In the commodities market, the global oil benchmark Brent crude experienced a significant jump, rising by 1.65 percent to $78.31 a barrel. Meanwhile, Foreign Institutional Investors (FIIs) sold off equities worth Rs 855.80 crore on Monday, as per exchange data.
The year 2023 saw the BSE benchmark surge by 11,399.52 points or 18.73 percent, and the Nifty climbed by 3,626.1 points or 20 percent.
The Nifty's 20% gain in 2023, particularly in the final two months, was supported by factors like quick quarterly growth, expectations of US rate cuts in the first half of 2024, and steady retail participation.
(With inputs from agencies)
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