Whalesbook
Trading on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) was suspended on May 1, coinciding with Maharashtra Day. The markets are scheduled to reopen on May 4. The prior trading session, April 30, concluded with significant downward movement for key Indian indices.
The benchmark Sensex shed 582.86 points, marking a 0.75 percent decline to close at 76,913.50. The Nifty 50 followed suit, dropping 180.1 points, or 0.74 percent, to settle at 23,997.55. This downturn was largely attributed to a confluence of adverse global factors.
Geopolitical Tensions and Crude Oil Spike
Escalating geopolitical tensions, particularly in the Middle East, alongside a surge in Brent crude prices to levels not seen in years, significantly impacted market sentiment. The spike in oil prices, a critical import for India, raises concerns over inflationary pressures and potential macroeconomic instability. Analysts noted the broad-based nature of the sell-off, with metals, realty, and FMCG sectors experiencing notable declines, while the IT sector showed relative resilience.
Rupee Weakness and FII Outflows
Adding to the pressure, the Indian rupee depreciated further, touching fresh record lows against the dollar before partially recovering. Foreign institutional investors (FIIs) continued their net selling in equities, offloading shares worth Rs 8,048 crore on April 30, further weighing on investor confidence. Domestic institutional investors (DIIs) provided some support by net buying Rs 3,487 crore worth of equities.
Expert Outlook
Ajit Mishra, SVP of Research at Religare Broking, commented on the volatility, stating, "Markets remained volatile on Thursday and declined over half a percent amid adverse global cues." He highlighted that a lack of conviction among participants is evident, though this phase is expected to resolve soon. Mishra advised traders to maintain a cautious stance, focus on risk management, and identify sector-specific opportunities. He indicated that a decisive move below 23,800 in the Nifty could lead to further declines towards 23,500, with resistance expected in the 24,400-24,800 zone.
The commodity derivatives segment observed a partial closure, remaining shut for the morning session but open for the evening session, reflecting the varied trading schedules during public holidays.