Mumbai: The stock markets that opened positive across Asia and India on Thursday soon turned into a sea of red with the European markets also opening in the red, as US President Barack Obama reiterated his determination to fight the ISIS.
The Sensex closed below the 27,000 level on Thursday at 26,995.87 while the Nifty which rose to a little over 8,100 on opening closed at 8,085.70. The Sensex was also under pressure as blue chip stocks like ONGC and Coal India fell on government’s announcement of disinvestment in these PSU’s. Marketmen sold these stocks as government would be offloading its stake at a discount to the market price.
The markets were also cautious ahead of announcements expected on Friday on the balance of trade, inflation data and Industrial production data.
Alex Mathews, head, research, Geojit BNP Paribas Financial Services Ltd, said while there was profit booking mainly in stocks like Sun Pharma, ONGC and Coal India, the mid cap and small cap were seen out performing the broader markets and closed up around 1.08 per cent and 1.42 per cent respectively.
The rupee took a knock after seeing a high during the morning. Kiran Kumar Kavikondala, director & CEO, WealthRays Securities said the correction in equity markets and FII/FPI outflow in previous session kept the Rupee in a range on Thursday.
The Rupee opened flat at 60.94 and strongly took support near 60.9350 levels. “Tracking strength from equity markets in the morning the Rupee made gains of 20 paisa and touched intra-day low of 60.7250 as equity markets closed. Asian currencies were mixed against US dollar with the Yen at an 8 -month low,” he said.
The near term trigger for the market will be the FOMC of the US Fed Reserve meet on September 17 said Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services Ltd.
“Markets have heard risk of interest rates to tend higher, but the Fed is unlikely to change interest rates. The risk of an early hike to US interest rates exist and this would impact inflows to the emerging markets. Though India is in a better footing among the EMs on fundamental terms, the valuation and momentum taken to reach current levels have instilled fear,” he said.
