Bloodbath in Indian Stock Market
Mayhem in the market as the stock indexes experienced their
steepest decline since March 2020, erasing all of Monday's gains. Sensex closed at 72079(-4390) and Nifty at 21885(-1379), after touching intraday low of 6235 and 2168 points respectively. This came
after exit polls indicated that the BJP-led alliance is likely to secure a
two-thirds majority in the lower house.
The volatility index spiked to 29.79, its highest level since
March 2022, after easing on Monday.
All sectors saw declines, Bank stocks fell by 7.8%, real estate
by 9.1%, infrastructure by 10.5%, oil and gas by 11.7%, and state-run companies
and banks by 17% and 16%, respectively. Adani Group’s Stocks fell corrected by 9%
to 19%. Reliance fell by 7.5%.
The market fears may drive it decline further. Even with the
current majority, there will be some disappointment as it falls below market
expectations. Markets were at an all-time high, with significant hope built on
BJP's majority. These expectations will unwind in the next few sessions, and
the focus will shift to policy announcements as reforms are expected to
continue with NDA securing an absolute majority.
The U.S. labor market's strength will be closely monitored with
the Job Openings and Labor Turnover Survey (JOLTS) due on Tuesday including the
non-farm payroll data.
On Monday, U.S. Treasury yields fell to a two-week low after a
second consecutive month of declining manufacturing activity in May. The
two-year yield dropped by 6 basis points, while the 10-year yield decreased by
11 basis points.
U.S. crude dipped 0.88% to $73.57 per barrel. Brent crude fell
to $77.77 per barrel. Both benchmarks hit four-month lows on Monday after OPEC
and its allies agreed to start unwinding some production cuts from October.
Comments
Post a Comment