Mumbai (Maharashtra) [India]: Indian stock markets opened on a bearish note on Monday, continuing their downward trajectory as global economic concerns weighed heavily on investor sentiment.
The Nifty 50 index started the day under significant pressure, falling over 1% or 236.10 points to 23,195.40. Similarly, the BSE Sensex saw a drop of 749.01 points or 0.97%, opening at 76,629.90.
Market analysts attributed the slump to a strengthening US Dollar and rising global bond yields, which have been exerting pressure on global equities. The uncertainty surrounding potential policy changes under Trump 2.0 has further fueled a “sell now, think later” mindset among investors.
Ajay Bagga, a banking and market expert, shared his perspective, saying, “The FPI short positions are nearing the level at which Indian markets have bottomed in the past. It is just one number, so we can’t be sure of it holding good. Monday markets are looking challenging after the US markets fell on Friday. A huge amount of pessimism has been baked into global and Indian markets.”
He added, “However, for now, the focus is on the rising global yields and the Trump policies, which will impact inflation and debt levels. We stay optimistic that markets will absorb the changed data and progress further.”
Sectoral Performance
All major sectoral indices on the NSE opened in the red. Nifty FMCG and Nifty Consumer Durables dropped over 1% during early trading, while Nifty IT declined by 0.5%. Nifty Bank and Nifty Auto registered losses of 0.9%.
Rising global inflation, higher oil prices due to new sanctions on Russian entities by the outgoing Biden administration, and concerns about debt levels have created a challenging environment for stock markets worldwide.
Among Nifty 50 stocks, 49 opened with losses. IndusInd Bank was the sole stock to open in the green. The top losers included BPCL, BEL, Power Grid, NTPC, and Trent.
Akshay Chinchalkar, Head of Research at Axis Securities, emphasized key technical levels, stating, “The area between 23,177 and 23,355 will continue to matter on the way down, while immediate resistance stands at 23,600. Interestingly, even though the percentage of stocks in the Nifty above the 200-day average has fallen to 34, the 14-day momentum isn’t oversold yet, which could mean more weakness could be ahead of us. For the day, let’s watch 23,238 on the downside, which is critical.”
Global Trends
Other Asian markets mirrored the negative sentiment. Taiwan Weighted fell over 2%, South Korea’s KOSPI dropped 1.18%, and Hong Kong’s Hang Seng declined by 1.32%. Japan’s Nikkei remained closed for a public holiday.
As global markets remain under pressure, investors are now looking to robust US corporate earnings, expected from January 15, to potentially ease the prevailing pessimism.