Sensex drops 627 points, Nifty ends at 14,691; Banks, RIL drag market
By Administrator_India
The Indian indices wavered on Wednesday as the US bond yields advanced and the dollar extended gains, triggering a flight to safety by global investors.
The Sensex fell 627 points, or 1.25 percent, to end at 49,509, while the Nifty fell 154 points, or 1.04 percent, to close at 14,691. A day earlier, both the indices had posted their biggest gain in nearly two months, advancing 2.3 percent each.
Rising Covid-19 cases and fears of curbs to contain its spread weighed on investor sentiment. The meltdown at Bill Hwang’s Archegos Capital Management also kept markets nervous as more banks warned of losses.
Most global markets edged lower as investors awaited more details on the next leg of US stimulus spending. President Joe Biden was poised to unveil a large infrastructure package, aimed at rebuilding infrastructures like highways, bridges, and rail lines.
The 10-year US bond yields advanced again during Asian trading, having touched a 14-month high of 1.77 percent before subsiding overnight. Experts said investors were eyeing the course of the US growth rebound and its possible impact on inflation, amid concerns that the surge in bond yields could hit the equities market.
Foreign portfolio investors (FPIs) sold shares worth Rs 1,689 crore, while domestic institutions bought shares worth Rs 2,081 crore.
Financial stocks led the fall on Wednesday. HDFC fell 4.1 percent, HDFC Bank fell 3.9 percent, and ICICI Bank fell about 2 percent. IT stocks outperformed the market for a second day as Biden was expected to allow the ban on H1B visas to expire.
The Sensex ended the month with a gain of just 0.8 percent. After rising as much as 9.2 percent, the blue-chip company index ended the first quarter of 2021 with a gain of 3.7 percent. Rising bond yields and resurgence in Covid have seen the market come off from its highs in mid-February.
