Sensex Today Plunges 1,628 Points | HDFC Bank Sinks 8% | 5 Reasons Why Indian Share Market is Falling

Wed, 17 Jan Closing

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After opening the day on negative note, Indian share markets extended losses as the session progressed and ended the day on a weak note.

Weak global sentiment, coupled with bear hammering of HDFC Bank, dragged benchmarks sharply lower Wednesday.

At the closing bell, the BSE Sensex stood down by 1628 points (down 2.2%).

Meanwhile, the NSE Nifty closed down by 460 points (down 2.1%).

TCS, Infosys and HCL Tech were among the top gainers today.

Tata Steel, Hindalco and Axis Bank on the other hand, were among the top losers today.

The GIFT Nifty was trading at 21,586 down by 250 points, at the time of writing.

Broader markets ended on positive note. The BSE MidCap index and BSE SmallCap index ended 1% lower.

Sectoral indices ended mixed with stocks in the media sector, IT sector and consumer durables sector witnessed buying. Meanwhile, stocks in banking sector and metal sector witness selling pressure.

Shares of IRFC, L&T, PCBL hit their respective 52-week highs today.

Now track the biggest movers of the stock market using stocks to watch today section. This should help you keep updated with the latest developments...

Asian share markets ended mixed. The Shanghai Composite ended 2.1% lower, while the Nikkei index ended 0.4% lower. Meanwhile Hang Seng ended 3.7% lower.

The rupee is trading at 83.14 against the US$.

Gold prices for the latest contract on MCX are trading marginally lower at Rs 61,934 per 10 grams.

Meanwhile, silver prices are trading 0.4% lower at Rs 71,776 per 1 kg.

Here are five reasons why Indian Markets are falling today.

#1 Delay in rate cuts

The sentiment was dented amid easing of rate-cut expectations after US Federal Reserve governor Christopher Waller warned that a pivot in the monetary policy may come slower than anticipated.

Following the hawkish comments, investors see roughly a 65% chance that the US central bank would begin its rate-cutting regime from March.

#2 Disappointing HDFC Bank Q3 Result

Shares of HDFC Bank were the worst hit, down nearly 8 percent after the lender's December quarter results continued to reflect pressure on net interest margin even though headline numbers met market expectations.

The stock has the highest weightage on the Nifty 50 at 13.5% and hence a selloff in the counter mounted pressure on the headline index.

#3 Muted global cues

Asian markets also bled in today's trade tracking Wall street losses. The pain was aggravated as China's Q4 GDP slightly missed estimates and grew 5.2% over last year. Hong Kong's Hang Seng tanked 3.7%, CSI 300, Kospi too sank over 2% each. Nikkei dipped 0.4%.

#4 Profit booking

After a sharp rally in the markets with Nifty 50 scaling above 22,100 in the previous session, investors likely opted to take some profit out of the table.

#5 Spike in US bond yields

The comments also led to a spike in yields on the US 10-year treasury bonds to back above the 4% along with a rise in the dollar index to a month's high.

Speaking of stock markets, the last few days however have been quite hard on Polycab India. It has seen its share price erode by a huge 30% from its top and there could be more losses in the offing.

The decline is a result of the company coming in the cross hairs of the tax authorities.

Is this reason enough for the share price to fall 30%? Or are investors overreacting as usual?

Rahul Shah co-head of research at Equitymaster, answers these questions in below video.

L&T's Multiple Order Win

In news from the engineering sector, the share price of L&T scaled a 52-week high of Rs 3,614, gaining nearly 1% after the company's buildings and factories (B&F) business won an order in India and Oman.

The residential business of B&F has secured a significant repeat order from the Government Planning and Development Authority, Maharashtra, to build EWS housing, 14 towers and related infrastructure in Navi Mumbai.

The scope of works includes the design and construction of civil structures in all aspects, including finishes, MEP, and related external development works. The project is to be executed within 42 months.

The business, through the L&T Oman entity, has been awarded the contract for a mixed-use development project in Muscat by a reputed private client.

This contract involves the construction of a three-star hotel featuring 80-key hotel rooms, 101 serviced apartments, and a 23-key residential apartment and office block with a common basement, associated service buildings, external works, services, as well as hard and soft landscaping.

The railways strategic business group of L&T Construction has secured a mega contract to construct 508 route km of high-speed electrification system works for the Mumbai-Ahmedabad High-Speed Rail (MAHSR) project, popularly referred to as the bullet train project.

It stands among the five large-caps that have delivered the highest returns to investors in 2023.

For more, check out the Top 5 Biggest Gainers of 2023. Will Their Dream Run Continue?

L&T has been an investor's favourite stock for a long time and also a stock that makes it to the top 5 infrastructure stocks.

In line with its commitment to a sustainable future, L&T is poised to make significant strides in the green hydrogen landscape. For more details, check out L&T's next big leap in the green hydrogen space.

MRF Scales to Rs 1.5 Lakh Mark

Moving on to news from the tyre sector, shares of Madras Rubber Factory, popularly known as MRF, touched the Rs 1.5-lakh mark, extending gains for the sixth trading session in a row on the bourses. At this price, MRF became the most expensive Indian stock.

The stock had climbed over 53%, or Rs 48,000, last year against a 20% gain in the Nifty.

The company posted a five-fold surge in its Q2 net profit to Rs 5.7 bn on-year, while it stood at Rs 1.2 bn in the base quarter. The stark rise in net, despite a subdued revenue growth can be attributed to the sharp improvement in the company's operational performance during the quarter under review.

The company's revenue also grew 6.5% on-year to Rs 60.9 bn against Rs 57.2 bn in the same quarter of the previous fiscal.

For more, check out The Great Indian Tyre Stocks Rally. Will the Good Run Continue in 2024?

To know what's moving the Indian stock markets today, check out the most recent share market updates here

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

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