Stock market: Sensex slips 156 pts, Nifty below 25,950; rupee hits fresh record low

Domestic benchmarks Sensex and Nifty opened lower on Thursday, weighed down by mixed global cues, a weaker rupee against the dollar, and continued FII outflows.

At 9:16 am, the BSE Sensex fell 114.96 points, or 0.14 per cent, to 84,991.85 after losing nearly 156 points in early trade. The NSE Nifty50 slid 42.95 points, or 0.17 per cent, to 25,943.05, after briefly touching a low of 25,938.95.  

Among Sensex constituents, Hindustan Unilever (HUL) led losers, falling 0.78 per cent to Rs 2,435.15. Power Grid slipped 0.71 per cent, while Eternal, Titan, and UltraTech Cement dropped 0.64 per cent, 0.60 per cent, and 0.53 per cent, respectively.

While the rupee against the US dollar slipped to its weakest level on record on Thursday, falling to Rs 90.56 in early trade.

Wall Street ended higher overnight, with all three major US indices closing in the green. The Dow Jones Industrial Average gained 0.86 per cent to 47,882.90, while the S&P 500 rose 0.30 per cent to 6,849.72. The tech-heavy Nasdaq Composite also edged up 0.38 per cent to finish at 23,454.09.

Asian markets traded mixed on Thursday. At last check, Japan’s Nikkei 225 advanced 1.47 per cent to 50,596.24, while South Korea’s KOSPI was down 1.04 per cent to 3,994.36. Hong Kong’s Hang Seng Index also inched up 0.21 per cent to 25,814.77.

On Wednesday, the Sensex slipped 31.46 points, or 0.04 per cent, to settle at 85,106.81, while the Nifty declined 46.20 points, or 0.18 per cent, to close at 25,986.

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the market is currently being pulled by two opposing forces—one negative and the other positive. “Sharp depreciation of above 5 per cent in the rupee and RBI’s policy of non-intervention to support the currency is a negative from the FII’s perspective,” he said.

“This has pushed the FIIs back to the sustained selling mode pulling the Nifty down by 340 points from the recent record high. The positive factor is India’s improving fundamentals - robust economic growth, low inflation, supportive monetary and fiscal policies and indications of steadily improving corporate earnings,” Vijayakumar said.

“It is important to understand that the negative factor may weigh on the market in the near-term, but the positive factor will dominate in the mid-term enabling the market to resume its upward journey. Therefore, this near-term currency-induced weakness can be used by long-term investors to accumulate high quality large and midcap stocks,” Vijayakumar added.