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Sensex falls over 250 points, Nifty ends below 10,950; key reasons for plunge

FE Online
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The benchmark equity indices — Sensex and Nifty — fell in Wednesday's trading session, owing to losses in heavyweights such as ITC, HDFC, L&T, and ICICI Bank and nervousness among investors around economic slowdown. The Sensex ended the day down 267.64 points, or 0.72 per cent, at 37,060.37. Nifty too closed the session 98.30 points, or 0.89 per cent, down at 10,918.70. In the Sensex pack, Hero MotoCorp, Infosys, Tech Mahindra, HUL, Bajaj Auto, Maruti, NTPC and HDFC Bank rose nearly 2 per cent. Tata Motors was the biggest loser in the Sensex pack, falling over 9 per cent, followed by Yes Bank at just over 8 per cent. The market breadth is in favour of declines, and the advance-decline ratio stands at 1:3.

"In the domestic markets, investors are pinning hopes on any stimulus/measures from the Indian government to lift the sentiments. On the global front, investors may take cues from FOMC minutes which will be released today. Meanwhile, we continue to remain cautious on the markets in the near-term," Ajit Mishra Vice President, Research, Religare Broking said.

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The investors are recommended to utilise the market correction to accumulate fundamentally strong stocks, he added.

"Today’s weakness continues to remain purely technical in nature. After forming the low near 10780, the NIFTY had shown a technical pullback which halted near the 200-DMA. The current decline seems to be a continuation of the weak technical setup and it will not be surprising if the NIFTY tests the 10780-10800 levels going ahead and therefore, the behavior of the NIFTY around 10800 will be critical to watch over the coming days," Milan Vaishnav, CMT, MSTA told Financial Express Online.

The global markets are also keenly awaiting comments from Federal Reserve Chair Jerome Powell in Jackson Hole, Wyoming, US, analysts also said, adding the investors may also track G7 Summit during August 25 to 27 in France.