Sensex Crash: As the US 10-year Treasury yield climbed beyond 4%, the key equity indexes Sensex and Nifty are off to a poor start in Wednesday’s trading.
The Nifty fell 385 points to 21,650 while the BSE Sensex plummeted 700 points to go below 72,000.
Large-cap losses were led by HDFC Bank, which fell more than 5% despite seeing a 2.5 percent QoQ increase in Q3 earnings to Rs 16,373 crore. The following top losses on the Franklin indexes were Axis Bank, Wipro, Tata Steel, Hindalco, Tata Motors, and Bajaj Auto.
Reliance, ITC, Nestle, HDFC Life, Cipla, Hero Moto, and Bharti Airtel, on the other hand, saw advances.
The BSE Smallcap and Midcap indexes saw a 0.9% decline as well.
The market is probably going to become a little weaker in the near future due to certain unfavorable local and international signals. The increasing US bond rates (the 10-year yield is at 4.04%) in response to worries that the Fed may not really implement the steep rate reduction anticipated this year will be the source of the worldwide gloom. According to current indicators, the Fed is not expected to make cuts in March, and the number of cuts in 2024 may not equal the five or six that the market had somewhat anticipated. This will cause the global share markets to lag. According to Dr. V.K. Vijaykumar of Geojit Financial, “all these positives are in the price and the valuations are elevated warranting a correction,” even if the domestic economy and corporate profits are doing well.
Worldwide Cues
Governor of the US Federal Reserve Christopher Waller on Tuesday urged the bank to go cautiously when lowering interest rates, stoking speculation that there could not be as many as Wall Street had anticipated.
The majority of Asian markets fell this morning. China’s Q4 GDP increased 5.2% YoY, somewhat undershooting forecasts. Hong Kong’s Hang Seng dropped 2.7%. Kospi dropped 1.7%, ASX 200 dropped 0.2%, and the Nikkei in Japan started to rise again, rising 1.2%.
The S&P 500 dropped 0.37 percent, the Dow dropped 0.62 percent, and the Nasdaq dropped 0.19 percent in the US overnight.