Sensex, Nifty decline further; FMCG shares fall for second day

The key equity benchmarks declined further in mid afternoon trade. The Nifty continued to trade below the 17,950 mark. FCMG shares declined for second consecutive session.

At 14:20 IST, the barometer index, the S&P BSE Sensex, was down 687.56 points or 1.13% to 60,067.30. The Nifty 50 index lost 187.50 points or 1.04% to 17,925.55.

In the broader market, the S&P BSE Mid-Cap index lost 0.64% while the S&P BSE Small-Cap index fell 0.18%.

The market breadth was negative. On the BSE, 1,393 shares rose and 1,965 shares fell. A total of 102 shares were unchanged.

Inflation globally has been rising beyond market expectations. There has been a sharp spike in US 10-year yield to a 2-year high of 1.89 per cent, as investors fear a US Fed intervention in the form of a rate hike as early as March.

Adding to woes is a rise in oil prices to a seven-year high after attacks on UAE oil tankers. Goldman Sachs expects oil prices to hit $100 per barrel in the second half of this year, citing a lower than expected hit to demand from the Omicron variant coupled ..

Firm global crude prices, increasing expectations of March rate hike by US central bank and rising geopolitical tensions on the Ukraine border dented investors' sentiment.

Numbers to Track:

The yield on India's 10-year benchmark federal paper fell to 6.611% as compared with 6.627% at close in the previous trading session.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 74.61, compared with its close of 74.58 during the previous trading session.

MCX Gold futures for 4 February 2022 settlement rose 0.07% to Rs 47,959.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.05% to 95.69.

In the commodities market, Brent crude for March 2022 settlement rose 22 cents or 0.25% to $87.73 a barrel.

Buzzing Index:

The Nifty FMCG index fell 0.87% to 37,175.20, extending losses for second trading session. The index has lost 2.15% in two session.

Emami (down 2.70%), Hindustan Unilever (down 2.43%), Colgate-Palmolive India (down 1.91%), Tata Consumer Products (down 1.71%), Britannia Industries (down 1.23%), Nestle India (down 1.06%), United Breweries (down 0.90%), Radico Khaitan (down 0.75%) and Procter & Gamble Hygiene (down 0.33%) declined.

Varun Beverages (up 2.02%), Godrej Consumer (up 0.89%), United Spirits (up 0.53%), Dabur India (up 0.65%) and Marico (up 0.58%) advanced.

Stocks in Spotlight:

Saregama India shed 0.66% to Rs 5298.80. On a consolidated basis, the company's net profit rose 37.43% to Rs 43.40 crore on 12.27% increase in net sales to Rs 150.34 crore in Q3 December 2021 over Q3 December 2020.

RITES added 1.18% toRs 270.85. The company entered into a memorandum of understanding (MoU) with CSIR-Central Road Research Institute (CRRI) to explore opportunities for cooperation in the infrastructure sector.

Global markets:

Shares in Europe and Asia declined on Wednesday as global markets take a downturn after a sell-off on Wall Street on Tuesday, prompted by rising bond yields.

Investors remain jittery over the U.S. Federal Reserve's schedule for hiking interest rates and tightening its ultra-loose pandemic-era monetary policy.

The U.K. inflation rate soared to a 30-year high in December, the Office for National Statistics said Wednesday, as higher energy costs, resurgent demand and supply chain issues continued to drive up consumer prices.

Inflation hit an annual 5.4%, its highest since March 1992 and up from 5.1% in November, itself a decade high.

US stocks fell sharply Tuesday as government bond yields hit Covid-era highs and after Goldman Sachs reported disappointing earnings. Microsoft announced that the software giant will buy video game company Activision Blizzard in an all-cash transaction valued at $68.7 billion.

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