Investors’ wealth has tumbled by over Rs 18.17 lakh crore during six days of market decline, with sentiments remaining extremely bearish amid rate hikes by global central banks, unrelenting foreign fund outflows, and a jump in crude oil prices.
The BSE Sensex’s bearish run in the backdrop of global slowdown has resulted in Indian investors losing more than ₹18 lakh crore in the last week or so – an amount above Reliance Industries Ltd’s market capitalization of ₹17.5 lakh crore.
The gloom in the stock markets is mainly because of bearish projections, a hike in interest rates by global central banks, outgoing foreign funds, and a sharp rise in prices of crude oil.
The 30-share BSE Sensex has tanked 3,959.86 points or 7.15 percent in six days of decline. It hit its one-year low of 50,921.22 during the day on Friday.
The continuous weak trend in equities has dragged down the market capitalization of BSE-listed firms by Rs 18,17,747.13 crore to Rs 2,36,77,816.08 crore during this time (June 9-June 17).
“Both globally and domestically, equity markets suffered carnage over the past two trading sessions as central banks around the world made aggressive rate hikes… Persistent FII selling and rising COVID cases have also affected sentiments,” said Siddhartha Khemka, Head of Retail Research. , Motilal Oswal Financial Services Ltd.
The benchmark BSE index fell 135.37 points, or 0.26 percent, to 51,360.42 on Friday.
“The dominant theme affecting equity markets globally is the synchronized global monetary tightening and ensuing fears of economic slowdown,” said VK Vijayakumar, chief investment strategist at Geojit Financial Services.
Stocks Action
Titan emerged as the top laggard among the Sensex constituents, skidding 6.06 percent, followed by Wipro, Dr. Reddy’s, Asian Paints, Sun Pharma, L&T, UltraTech Cement, and PowerGrid.
On the other hand, Bajaj Finance, Bajaj Finserv, ICICI Bank, Reliance Industries, ITC, HDFC Bank, and Tata Steel were among the gainers, spurting up to 2.63 percent.
Global markets were mixed on Friday but were on course to post their worst week since the pandemic-scarred March 2020 as policy tightening by central banks has raised fears of crimping consumption and economic growth.
Market Broadly
In the broader market, the BSE smallcap gauge declined by 0.88 percent on Friday, while the midcap index dipped 0.68 percent.
Among the BSE sectoral indices, oil and gas fell the most by 3.07 percent, followed by consumer durables (2.68 percent), energy (1.86 percent), healthcare (1.60 percent), and consumer discretionary goods and services (1.59 percent), and utilities (1.57 percent). Finance, bank, metal, and realty ended in the green.
“Undertone of the market continues to remain bearish with weak global cues dampening investors’ sentiment. Investors are treading with caution after the aggressive rate hike by the US Fed.
Moreover, FII selling is showing no signs of easing, which continues to have a bearing on the markets,” Amol Athawale, deputy vice president – technical research, Kotak Securities Ltd, said.
Foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 3,257.65 crore on Thursday, as per the exchange data
