Stock Market

Sensex sinks 305 pts, Nifty below 7800 on Fed rate hike fears


Chillicious Team

The market shed more than 1 percent in late extended sell-off on Thursday, tracking nervousness in global peers after Fed minutes indicated rate hike in June policy.

The 30-share BSE Sensex fell 304.89 points or 1.19 percent to 25399.72. The 50-share NSE Nifty breached 7800 level, down 86.75 points or 1.10 percent to 7783.40.

Experts are still positive on the market as they are betting on monsoon and gradual recovery in economy despite US rate hike fears but they don’t see major upside immediately.

Nifty is unlikely to have many upsides from its current levels, said Prashant Mittal of Ambit Capital. According to him, 8000 is acting as a near-term resistance for the index, with 7650 being the support level.

Amisha Vora of Prabhudas Lilladher said markets have held up very well on expectation of monsoon and gradual but slow recovery in the economy, but she does not rule out some jitters though going forward based on the global event.

Globally, European stocks traded lower as markets around the world digest the latest minutes from the US Federal Reserve that appeared to raise the prospect of an interest rate hike in June. France’s CAC, Germany’s DAX and Britain’s FTSE were down over 1 percent. Oil prices also declined more than 2 percent.

Meanwhile, election results of five states announced today. BJP won majority and Congress routed in Assam. Mamata Banerjee-led TMC and Jayalalithaa-led AIADMK retained power in West Bengal and Tamil Nadu, respectively. LDF won majority in Kerala and INC in Puducherry.

“The trend has reversed for the BJP with this win. So if we were to count on pan India sentiments, these results really do not bring out anything meaningful, as the equation at the centre does not change. However, one big positive is that the people of all the states have given clear majority to one party of their choice,” Motilal Oswal of MOFSL said.

Lupin rallied 1.4 percent after better-than-expected earnings in March quarter. Consolidated profit grew by 47.5 percent and revenue increased 35.9 percent compared to year-ago period, driven by US business despite sharp spike in tax cost.

Wipro advanced 0.7 percent as Denmark-based Vestas Wind Systems selected the company to provide workplace services.

Adani Ports shares tanked 6 percent after rating agency Moody’s has revised company’s rating outlook to negative from stable.

ITC shed 2.4 percent ahead of March quarter earnings due on Friday. A CNBC-TV18 poll expects profit to grow 7 percent but cigarette volumes may decline 1-6 percent YoY.

Among others, HDFC L&T, Reliance Industries, SBI, Axis Bank, ONGC and Cipla were down 2-4 percent.

About two shares declined for every share advancing on Bombay Stock Exchange.