Weekly market wrap: Sensex slips over 1,100 points; Infosys, HDFC Bank crack
Benchmark equity indices BSE Sensex and NSE Nifty extended their fall for the second straight week as rising concerns over inflation and disappointed March quarter results by select index heavyweights dampened sentiment.
- Apr 22, 2022,
- Updated Apr 22, 2022 7:15 PM IST
Benchmark equity indices BSE Sensex and NSE Nifty extended their fall for the second straight week as rising concerns over inflation and disappointed March quarter results by select index heavyweights dampened sentiment. The 30-share index Sensex retreated 1,141.78 points, or 1.96 per cent, to 57,197.15 on April 22, 2022 against 58,338.93 on April 13. Likewise, the 50-share NSE Nifty index slipped 303.70 points, or 1.74 per cent, to 17,171.95 during the same period.
Overall, the domestic equity markets made a gap down opening to the week as the World Bank cut its economic growth forecast for India and the whole South Asian region, citing worsening supply bottlenecks and rising inflation risks caused by the Ukraine crisis. The international agency lowered its growth estimate for India to 8 per cent from 8.7 per cent for FY23.
Meanwhile, sentiments weakened further after March wholesale price index-based inflation rose to 14.55 per cent as compared to 13.11 per cent last month.
As many as 34 stocks in the Nifty index settled the week in the red. With a fall of 9.33 per cent, Infosys emerged as the top loser in the 50-share pack. HDFC Bank, Tech Mahindra, HDFC, Hindalco and JSW Steel also cracked over 5 per cent. Coal India, Reliance Industries, Mahindra & Mahindra, Maruti Suzuki and Eicher Motors surged somewhere between 5 per cent and 9 per cent.
Vinod Nair, head of research, Geojit Financial Services said, "Global markets have moved cautiously in context to inflation data release, uncertainties of war development, volatile crude prices, hawkish Fed policy and mixed quarter results. Similarly, the domestic market has been volatile with hawkish RBI policy and negative start to Q4 result season by IT and mixed results by the banking sector."
"This has led to heavy selling in heavyweights by FIIs. Weak IT results have prompted the market to be worried about the headwinds like attrition, wage inflation, lower utilisation, and a possible cut in IT spending by industries due to geopolitical and macro issues. The degree of downfall is high because the sector is trading at a high valuation and risk of the downgrade is increasing, affecting the short and medium-term performance," Nair added.
Sectorwise, the BSE IT index plunged the most by 5.50 per cent during the week. It was followed by BSE Bankex (down 3.50 per cent), Realty (down 3.41 per cent) and Metal (down 2.67 per cent). On the other hand, the BSE Auto and Oil & Gas indices gained 2.86 per cent and 1.49 per cent, respectively.
The forthcoming week is likely to remain volatile on account of futures & options (F&O) expiry, with the near month April 2022 derivatives contract expiring on Thursday, April 28, 2022.
In the ongoing result season, market participants also would be eyeing earnings from ICICI Bank, Bajaj Finance, Nelco, Tata Coffee, UBL, VST Industries, Bajaj Auto, HDFC AMC, Hindustan Unilever, IEX, Ambuja Cements, Yes Bank, Axis Bank, Bajaj Holdings & Investment, SBI Life Insurance Company, IndusInd Bank, L&T Finance Holdings, Tata Chemicals, UltraTech Cement, Wipro and IDFC First Bank, among others.
Also read: Don't believe RBI behind the curve in terms of interest rates: Keki Mistry
Also read: Nykaa acquires stakes in diverse brands Earth Rhythm, Nudge Wellness and KICA
Benchmark equity indices BSE Sensex and NSE Nifty extended their fall for the second straight week as rising concerns over inflation and disappointed March quarter results by select index heavyweights dampened sentiment. The 30-share index Sensex retreated 1,141.78 points, or 1.96 per cent, to 57,197.15 on April 22, 2022 against 58,338.93 on April 13. Likewise, the 50-share NSE Nifty index slipped 303.70 points, or 1.74 per cent, to 17,171.95 during the same period.
Overall, the domestic equity markets made a gap down opening to the week as the World Bank cut its economic growth forecast for India and the whole South Asian region, citing worsening supply bottlenecks and rising inflation risks caused by the Ukraine crisis. The international agency lowered its growth estimate for India to 8 per cent from 8.7 per cent for FY23.
Meanwhile, sentiments weakened further after March wholesale price index-based inflation rose to 14.55 per cent as compared to 13.11 per cent last month.
As many as 34 stocks in the Nifty index settled the week in the red. With a fall of 9.33 per cent, Infosys emerged as the top loser in the 50-share pack. HDFC Bank, Tech Mahindra, HDFC, Hindalco and JSW Steel also cracked over 5 per cent. Coal India, Reliance Industries, Mahindra & Mahindra, Maruti Suzuki and Eicher Motors surged somewhere between 5 per cent and 9 per cent.
Vinod Nair, head of research, Geojit Financial Services said, "Global markets have moved cautiously in context to inflation data release, uncertainties of war development, volatile crude prices, hawkish Fed policy and mixed quarter results. Similarly, the domestic market has been volatile with hawkish RBI policy and negative start to Q4 result season by IT and mixed results by the banking sector."
"This has led to heavy selling in heavyweights by FIIs. Weak IT results have prompted the market to be worried about the headwinds like attrition, wage inflation, lower utilisation, and a possible cut in IT spending by industries due to geopolitical and macro issues. The degree of downfall is high because the sector is trading at a high valuation and risk of the downgrade is increasing, affecting the short and medium-term performance," Nair added.
Sectorwise, the BSE IT index plunged the most by 5.50 per cent during the week. It was followed by BSE Bankex (down 3.50 per cent), Realty (down 3.41 per cent) and Metal (down 2.67 per cent). On the other hand, the BSE Auto and Oil & Gas indices gained 2.86 per cent and 1.49 per cent, respectively.
The forthcoming week is likely to remain volatile on account of futures & options (F&O) expiry, with the near month April 2022 derivatives contract expiring on Thursday, April 28, 2022.
In the ongoing result season, market participants also would be eyeing earnings from ICICI Bank, Bajaj Finance, Nelco, Tata Coffee, UBL, VST Industries, Bajaj Auto, HDFC AMC, Hindustan Unilever, IEX, Ambuja Cements, Yes Bank, Axis Bank, Bajaj Holdings & Investment, SBI Life Insurance Company, IndusInd Bank, L&T Finance Holdings, Tata Chemicals, UltraTech Cement, Wipro and IDFC First Bank, among others.
Also read: Don't believe RBI behind the curve in terms of interest rates: Keki Mistry
Also read: Nykaa acquires stakes in diverse brands Earth Rhythm, Nudge Wellness and KICA