Global growth worries pull Sensex 250 points lower; Nifty below 18,100

After weak US consumer data and hawkish comments from Federal Reserve officials, benchmark equity indices opened in the red on Thursday, dragged by losses in banking, financial and IT stocks.

The BSE Sensex was trading 266 points or 0.44% lower at 60,780 while Nifty50 was trading at 18,084, down 81 points or 0.44% at around 9.29 am.

Among Sensex stocks, UltraTech Cement, Titan, Bharti Airtel, Tata Motors and Kotak Bank were the top laggards, falling about 0.5-1%. Infosys, HUL, Tech Mahindra, L&T and Wipro also opened with cuts.

However, Axis Bank, Asian Paints, NTPC, Power Grid, IndusInd and ITC opened with gains.

Sectorally, Nifty Metal index fell 0.81% and Nifty IT declined 0.46%. Nifty Bank and Nifty Financial Services also opened lower. Whereas, in the broader market, Nifty Smallcap50 dropped 0.27% and Nifty Midcap50 fell 0.18%.

Expert View
“The crucial issue influencing equity markets globally is whether the US will succeed in containing inflation without falling into a recession. There is no consensus on this,” V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said.

“Early Q3 results indicate good performance by IT and banking. Bank Nifty is slightly weak on concerns of pressure from rising deposit costs. But the credit cycle is strong. IT numbers do not reflect recession fears. Trend indicates that the capital goods segment is strong,” Vijayakumar added.

Deepak Jasani, Head of Retail Research at HDFC Securities said, “Nifty has managed to build on the gains of the previous day. Now it could face resistance from 18265 while the 18049-18072 band could provide support.”

Global Markets
The S&P 500 and the Dow lost almost 2% on Wednesday, their biggest daily drops in more than a month, after weak economic data fueled recession worries while hawkish comments from Federal Reserve officials soured investor moods further.

Asian stock markets struggled to make headway on Thursday, after weak U.S. consumer data stoked recession worries and nudged investors toward safe assets such as bonds, while Japan's yen rose as markets doubted the Bank of Japan's policy commitments.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.8%. Japan's Nikkei also dropped over 1%.

Currency Watch
The Indian rupee fell by 0.17% to 81.38 against the US dollar in early trade.

The dollar index, which tracks the movement of the greenback against a basket of six major world currencies, declined 0.01% to 102.35 level.

Crude Price
Oil prices fell on Thursday, Brent crude futures were down 1.2%, at $83.97 a barrel, while U.S. West Texas Intermediate (WTI) crude futures declined 1.4%, to $78.69 a barrel.

(With inputs from agencies)

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