Sensex Falls Over 100 Points, Nifty Struggles Above 11,000

Domestic stock markets started Thursday’s session on a lacklustre amid cautious trade by investors ahead of expiry of monthly derivatives contracts. At 2:18 pm, the NSE’s Nifty50 was trading 77.00 points, or 0.70 per cent, lower at 10,976.80 while the S&P BSE Sensex was down 197.84 points, or 0.54 per cent, at 36,344.43. Weakness in Asian peers after the Federal Reserve announced a hike in key interest rate overnight also dampened sentiment in the domestic markets. However, the government’s move on customs duty applicable to 19 items eased some concerns on the current account deficit front, and limited the down-slide. 

Main losers in the 30-share Sensex pack in the morning session were ICICI Bank (-0.16%), Larsen & Tourbo (-0.18%), Sun Pharma (-0.31%), Maruti (-0.57%), HDFC (-1.19%) and Yes Bank (-2.06%). The top laggards in the 50-share Nifty pack were Yes Bank, IndiaBulls Housing Finance, Bajaj Finance, Dr Reddy’s and Sun Pharma.

The rupee strengthened by 22 paise to trade at 72.38 against the US dollar on Thursday.

The Reserve Bank of India (RBI) eased mandatory cash requirement rules for banks on Thursday. The central bank also said it would provide “durable liquidity” amid growing worries of a potential credit crunch in the economy. 

The move by the central bank came a day after the government announced hikes in import duties on 19 items, including jet fuel and air conditioners, with an aim to narrow the current account deficit.

Thursday also marked the expiry of derivatives – or futures and options – contracts for the month of September.

Global equities ran out of steam and US bond yields fell. The Fed bumped up its policy target by a quarter of a percentage point to 2.00-2.25 per cent and indicated that it foresees another rate rise in December, three more next year, and one in 2020. Oil prices rose on Thursday, lifted by looming US sanctions against major crude exporter Iran.

Domestic institutional investors (DIIs) bought shares worth a net of Rs 1,555.44 crore, while foreign portfolio investors (FPIs) sold shares worth a net of Rs 809.95 crore on Wednesday, provisional data showed.

Meanwhile, domestic stock markets closed lower on Wednesday, dragged by consumer goods and IT stocks. The S&P BSE Sensex declined 109.79 points to end at 36,542.27. The NSE’s Nifty50 index dropped 13.65 points to settle at 11,053.80. (With agencies inputs)

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