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India Stocks Review:Indices at 1-yr low as hostile Fed rattles Street

Informist, Thursday, Jun 16, 2022

 

By Ankika Biswas

 

MUMBAI – Domestic equities saw a sell-off today as recession fears once again haunted investors following the aggressive stance taken by the US Federal Reserve to tame soaring inflation. Trampled by the bears on the Street, headline indices hit their lowest levels in over a year.

 

With today’s losses, the Nifty 50 has slumped 17% from its lifetime high of 18604.45 points, hit in October 2021. Another 3% losses from current levels could tip it into a bear market–20% fall from peak.

 

On Wednesday, Fed raised interest rates by 75 basis points and said that it will be aggressive in raising it further in order to bring down price pressures. Besides, it has raised inflation forecast for 2022 and cut the GDP growth aim.

 

If inflation does not come down in 2-3 months, Fed may have to induce recession to contain inflation, deliberately killing demand with drastic policy measures, said Pawan Parekh, fund manager at Renaissance Investment Managers.

 

Today, the Bank of England will also announce its interest rate decision.

 

However, the headline indices had gained over 1% in early trade, tracking the rebound in global markets, before selling across major frontline sectors trickled in. The fall was most prominent in metals, information technology and bank stocks.

 

The Indian headline indices fared much worse than most of their Asian peers, with key indices in Singapore, Taiwan and China falling 0.3-1.3% today.

 

Both the Nifty 50 and Sensex closed 2% lower at 15360.60 points and 51495.79 points, after slipping to 15335.10 points and 51425.48 points, respectively, earlier in the day. This was after touching intra-day highs of 15863.15 points and 53142.50 points, respectively. 

 

Reports of renewed fears of lockdown following China’s COVID-19 situation and India reporting the highest number of cases in nearly four months also weighed on sentiment.

 

Even the easing crude oil prices today failed to provide any relief to investors, who remained rattled by the Fed’s aggressive liquidity tightening path. 

 

Among stock-specific action, Tata Motors slumped over 5% as the company said the COVID-19 lockdowns in China could adversely impact its business outlook. Further, Jefferies lowering its global electric vehicle sales estimates for 2022 and 2023 could’ve also weighed on the stock.

 

Airline companies—InterGlobe Aviation and SpiceJet– fell sharply after a hike in aviation turbine fuel threatened to impact their earnings and dented the outlook for the sector. 

 

Sharp selling was also seen in the broader market, with most mid- and small-cap indices on the NSE falling 2-3%.

 

* Among Nifty 50 stocks, 2 rose and 48 fell

* Among Sensex stocks, 1 rose and 29 fell

* On the NSE, 288 stocks rose, 1,814 fell and 48 were unchanged

* On the BSE, 620 stocks rose, 2,754 fell and 102 were unchanged

* Nifty Bank: Down 2.2%; Nifty IT: Down 2.4%; Nifty Metal: Down 5.2%

BSE                                                 National Stock Exchange
Sensex: 51495.79 points, down 1045.60 pts (1.99%)    Nifty 50: 15360.60 points, down 331.55 pts (2.11%)

S&P BSE Sensitive Index                            Nifty 50
Lifetime High: 62245.43 (Oct 19)                 : Lifetime High: 18604.45 (Oct 19)
Record Close High: 61765.59 (Oct 18)             : Record Close High: 18477.05 (Oct 18)

2022 1st day close: 59183.22 (Jan 3)             : 2022 1st day close: 17625.70 (Jan 3)
2022 Closing High: 61308.91 (Jan 17)             : 2022 Closing High: 18308.10 (Jan 17) 
2022 Closing Low: 51495.79 (Jun 16)              : 2022 Closing Low: 15360.60 (Jun 16)
2022 High (intraday): 61385.48 (Jan 17)          : 2022 High (intraday): 18321.55 (Jan 17)

2022 Low (intraday): 51425.48 (Jun 16)            : 2022 Low (intraday): 15335.10 (Jun 16)
2021 Closing High: 61305.95 (Oct 14)             : 2021 Closing High: 18338.55 (Oct 14) 
2021 Closing Low: 46285.77 (Jan 29)              : 2021 Closing Low: 13634.60 (Jan 29)
2021 High (intraday): 61353.25 (Oct 14)          : 2021 High (intraday): 18350.75 (Oct 14)
2021 Low (intraday): 46160.46 (Jan 29)           : 2021 Low (intraday): 13596.75 (Jan 29)-

2020 Closing High: 47751.33 (Dec 31)             : 2020 Closing High: 13981.95 (Dec 30)
2020 Closing Low: 25981.24 (Mar 23)              : 2020 Closing Low: 7610.25 (Mar 23)
2020 High (intraday): 47896.97 (Dec 31)          : 2020 High (intraday): 14024.85 (Dec 31)
2020 Low (intraday): 25638.90 (Mar 24)           : 2020 Low (intraday): 7511.10 (Mar 24)
2019 High (intraday): 41809.96 (Dec 20)          : 2019 High (intraday): 12293.90 (Dec 20)
2019 Low (intraday): 35287.16 (Feb 19)           : 2019 Low (intraday): 10583.65 (Jan 29)
2018 High (intraday): 38938.91(Aug 28))          : 2018 High(intraday): 11760.20 (Aug 28)
2018 Low (intraday): 32483.8 (Mar 23)            : 2018 Low (intraday): 9951.9 (Mar 23)
2017 High (intraday): 34005.37 (Dec 26)          : 2017 High(intraday): 10515.10 (Dec 26)

 

Edited by Arshad Hussain

 

Cogencis news is now Informist. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

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Source: Cogencis

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