Benchmarks extend losses for third session in a row; Sensex down 636.24 pts

On Tuesday, FPIs were net sellers to the tune of ₹2,854 crore, while domestic institutional investors (DIIs) bought shares worth ₹5,908 crore

Equity benchmark indices Sensex and Nifty tumbled nearly 1 per cent on Tuesday, weighed down by a widespread selloff amid foreign fund outflows and growing geopolitical uncertainties.

 

Domestic markets fell for the third straight session as investors offloaded energy, finance, and IT stocks, traders said.

 

In a volatile trading session, the 30-share BSE index dipped 636.24 points or 0.78 per cent to settle at 80,737.51. The NSE Nifty plunged 174.1 points or 0.7 per cent to settle at 24,542.50.

 

As many as 2,266 stocks declined, while 1,731 advanced and 147 remained unchanged on the BSE.

 

On Tuesday, Foreign Portfolio Investors (FPIs) were the net sellers to the tune of ₹2,854 crore, while domestic institutional investors (DIIs) bought shares worth ₹5,908 crore. FPIs turned net sellers in June after making their largest net purchase of ₹19,860 crore in May, the highest in eight months.

 

 

ICICI Bank and HDFC Bank were the biggest contributors to the Sensex decline, falling 0.9 per cent and 0.4 per cent respectively. Both stocks have significant FPI ownership. The FPI selling came as the OECD slashed its global economic growth forecasts for the second time this year, citing US trade policies. The Paris-based organisation stated that trade barriers are eroding confidence, hindering investments, and exacerbating inflationary pressures. 

 

Adani stocks decline

 

Shares of Adani group companies declined following a news report alleging that US prosecutors were investigating whether Adani entities had imported Iranian LPG into India via their Mundra port.

 

The report highlighted that tankers travelling between the Gulf and Mundra port allegedly exhibited traits common to ships evading sanctions. The US Justice Department was reportedly reviewing the activities of several LPG tankers used to ship cargoes to Adani Enterprises. The Adani group dismissed the report as baseless and mischievous, stating they were unaware of any investigation by US authorities. Adani Ports saw the largest decline among Adani stocks, falling 2.4 per cent.

 

“Optimism over a potential RBI rate cut was offset by global concerns around trade tariffs and rising geopolitical tensions. Attention is likely to shift towards monsoon-linked themes and interest rate-sensitive sectors, such as PSU banks and real estate, amid hopes that monetary easing will support economic momentum. With the Q4 earnings season largely behind us, markets are expected to remain in a consolidation phase as participants shift focus to key macro trends and global cues,” said Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services.

 

Twelve of the thirteen major sectors logged losses.

 

“The domestic market remained in negative territory amid mixed global cues, geopolitical issues, and a volatile currency market led by a weak US dollar. Profit booking was evident across sectors, except for real estate stocks, which were supported by expectations of an interest rate cut by the RBI," said Vinod Nair, head of research, Geojit Financial Services.

 

"Mid- and small-cap stocks are experiencing relatively less consolidation than large caps due to better earnings growth and moderation in premium valuation. While short-term consolidation is likely to persist, strong domestic-oriented players are estimated to outperform against external volatility,” Nair added. 

 

(With inputs from agencies)