Sensex slides 873 points as caution returns to Dalal Street

MUMBAI: After two sessions of relative quiet on Dalal Street, Tuesday witnessed strong selling pressure as global economic concerns, especially about US' fiscal stability, made a comeback to leave investors jittery. As a result, the sensex closed 873 points or 1.1% lower at 81,864 points while the Nifty on NSE lost 262 points or 1.1% to 24,684 points.

Reports of increasing Covid-19 cases in some South-East Asian countries also weighed on investor sentiment. Selling was seen across the board. Compared to 1.1% slide in the two benchmark indices, BSE's midcap index was down 1.7% while the smallcap index closed 1% lower. The session left investors poorer by Rs 5.7 lakh crore with BSE's market capitalisation now at Rs 438 lakh crore.

According to Satish Chandra Aluri of Lemonn, a tech-driven stock trading platform, the fall in the market came on the back of global jitters sparked by Moody's downgrade of the US credit rating during the weekend. "The sell-off was further intensified by foreign institutional investors (FIIs) turning net sellers (on Monday) and widespread profit booking following a recent rally."

In Tuesday's session, foreign funds continued to remain net sellers at Rs 10,016 crore, while domestic funds were net buyers at Rs 6,738 crore, BSE data showed.

On Tuesday, of the 30 sensex constituents, 28 closed in the red while two stocks-Tata Steel and Infosys-closed higher. In the broader market, however, there were 2,642 laggards to 1,341 gainers, BSE data showed. On the sectoral front, auto, consumer discretionary and utilities were sold the most while IT stocks were least affected.

Going ahead, market players said the lack of any visible positive trigger would keep investor sentiment subdued. A potential India-US trade deal, hinted at by US President Donald Trump last week, was being eyed as a possible catalyst, Aluri said. "However, in the absence of any concrete announcement, market participants await more clarity."

From a chartist's point of view, the indices are looking weak, too.


Stay informed with the latest business news, updates on bank holidays and public holidays.

AI Masterclass for Students. Upskill Young Ones Today!– Join Now