Extending losses for the third consecutive session, equity markets ended lower Monday with BSE Sensex closing at 38,031, down 305 points and NSE Nifty ending 82 points down to settle at 11,337, as high selling interest continued in the equity market due to concerns over an economic slowdown and weak corporate earnings hurt the investor's sentiments.
"With Lack of any fresh positive domestic triggers and uncertain global cues, we maintain our cautious stance on the Indian equity markets. We expect stock specific volatility to remain high in the coming sessions, as the markets are likely to be driven by the on-going earnings season", quoted Ajit Mishra Vice President, Research, Religare Broking Ltd.
"Last week's mayhem continued as we saw a gap down opening followed by a sustained selling throughout the first half. This sell-off was disheartening because the stable propositions like HDFC Twins and Kotak Bank also finally succumbed to the broader market destruction," commented Sameet Chavan from Angel Broking.
HDFC and HDFC Bank were the biggest losers, plunging 5.09 per cent and 3.32 per cent, respectively, after the private bank reported a rise in non-performing assets (NPAs).
On the other hand, Yes Bank had a trend reversal after 3 consecutive days of being in the red and gained over 10%, amid reports that AION Capital might buy a majority stake in DHFL that would lead to an infusion of $1.5 billion into the debt-ridden firm. YES Bank has debt exposure of Rs 3,700 crore to DHFL as of March 2019.
Listed companies that posted their quarterly earning numbers in the trading session were GSK Pharma, OBC, ICICI Securities and Kotak Mahindra Bank. Can Fin Homes, Coromandel International, DHFL, Just Dial, United Spirits and TVS Motor Co. will be posting earnings report after the market hours.
Deficient monsoon rains, foreign fund outflows, weak corporate earnings and negative cues from other Asian markets impacted the risk sentiment.
As per the market analysts, foreign portfolio investors pulled out around Rs 7,712 crore from Indian equities in this month so far following the 'super-rich' tax announced in the budget for 2019-20. Market experts said the sell-off by foreign funds was due to the government's reluctance to tweak foreign portfolio investors (FPIs) income tax surcharge.
Earlier in the day, rupee opened on a cautious note at the Interbank Foreign Exchange and fell 26 paise to 69.06 against the US dollar in early trade amid strengthening of the greenback, foreign fund outflows, heavy selling in domestic equities and rising crude oil prices. The Indian rupee Friday had closed at 68.80 against the US dollar.
The global oil benchmark Brent crude futures soared 2.15% to USD 63.82 per barrel after Iran confiscated a British tanker in the strategic Strait of Hormuz.
Elsewhere in Asia, Shanghai Composite Index, Hang Seng, Kospi and Nikkei ended significantly lower, on account of geo-political tension between US-Iran and trade tension between US-China.
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