In Focus: Major Factors Driving D-Street’s Slump Today Amid Bearish Sentiments

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In Focus: Major Factors Driving D-Street’s Slump Today Amid Bearish Sentiments

By Malvika Gurung -- The domestic market made a gap-down opening on Dalal Street, extending its sell-off for the sixth consecutive session on Wednesday amid thrashed global cues and fears of an economic slowdown, while concerns loom over the US Fed’s aggressive monetary tightening.

Over the past two weeks, the market sentiment has reversed from bullish to bearish even though analysts and market experts believe that the Indian markets are in a better position than global peers.

At the time of writing, the benchmark indices appear to have erased some losses as Nifty50 is seen trading marginally low by 0.11% and Sensex is down 72.33 points or 0.13%.

While pharmaceutical, auto and IT stocks are lifting the market’s sentiment on Wednesday, banking, financial and metal stocks are the top drags.

Here are key factors driving the market sell-off.

  • Global Market Cues: S&P 500 plunged to its lowest level since Nov 30, 2020, in the overnight session, recording a new year-low amid the Fed’s ultra-hawkish monetary outlook. Further, Asian markets also collapsed on Wednesday with indices KOSPI , Nikkei 225 , Shanghai Composite and Hang Seng crashing up to 3% in the session.
  • Weakening INR: The Indian rupee hit a new lifetime low of 81.94/$1 today as the dominating US dollar index jumped to a fresh 20-year high.
  • Elevating Bond Yields: Indian government surged on Wednesday after the benchmark US 10-year Treasury surpassed 4% and touched its highest level since 2010.
  • Global Trade Forecast: According to the WTO chief, the global trade forecast is likely to be revised lower for 2022 from (present) 3% amid the Russia-Ukraine war and food and energy crises, stated Reuters.

Read Also: D-St Sell-Off Extends: Banking & Financial Stocks Drag Most, HDFC (NS: HDFC ) Twins Sink

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