Sensex Drops Over 100 Points in Opening Trade Amid Weak Global Cues, Nifty Below 11,650

Equity benchmark Sensex dropped over 100 points in opening trade on Wednesday tracking losses in financial stocks amid weak cues from global markets. The 30-share index was trading 100.60 points or 0.25 per cent lower at 39,473.97, and the NSE Nifty fell 23.45 points or 0.20 per cent to 11,638.95.

Bajaj Finance was the top loser in the Sensex pack, shedding around 5 per cent, followed by Bajaj Finserv, IndusInd Bank, ICICI Bank, Kotak Bank and Axis Bank. On the other hand, ONGC, Maruti, Reliance Industries, HUL and UltraTech Cement were trading on a positive note.

In the previous session, Sensex zoomed 600.87 points or 1.54 per cent to close at 39,574.57, while Nifty climbed 159.05 points or 1.38 per cent to end at 11,662.40. Exchange data showed that foreign institutional investors bought equities worth Rs 1,101.76 crore on a net basis on Tuesday.

According to Arjun Mahajan, Head – Institutional Business – at Reliance Securities, Indian equities are likely to trade sideways today with chances of profit booking at a higher level. Investors would be keenly watching out TCS numbers and management commentary to take fresh direction. Further, BFSI space after seeing sharp recovery may see some amount of selling ahead of the Supreme Court hearing on interest waiver early next week, he said.

Further, he stated that growing ambiguity over US fiscal stimulus after President Donald Trump’s tweet on Tuesday does not bode well for global equity including India. In a series of tweets, Trump said he had instructed his officials to stop negotiating with the House Democrats on another coronavirus stimulus package, alleging that Speaker Nancy Pelosi was not holding talks in good faith.

Bourses in Hong Kong, Tokyo and Seoul were trading with losses in mid-session deals, those in Shanghai were closed for a holiday. Wall Street indices ended on a negative note in the overnight session.

International oil benchmark Brent crude was trading 1.66 per cent lower at USD 41.94 per barrel. Meanwhile, Mahajan expects Indian investors to continue to focus on the possibility of domestic fiscal package announcement which is still on the cards in the near term.