Red Market Day! Sensex Drops Nearly 700 Points, And Nifty Falls Below 20,000. What Is Going On?
Red market day! On Wednesday, the Sensex recovered more over 700 points to reach 66,958 points, while the Nifty fell below 19,000 points. According to experts, the reason the Sensex is rising is because HDFC Bank, the largest private lender in the nation, has indicated a decline in asset quality following its merger with HDFC Ltd.
According to sources, after the merger with HDFC Ltd. was completed, HDFC Bank’s shares declined by around 3.5%, climbing it to the Nifty 50’s top losers’ list. The owner expressed concern that the recent blow would have an impact on important financial statistics like its net interest margin and non-performing assets.
However, experts claimed that the strained ties between India and Canada following Trudeau’s charge in regard to the murder of pro-Khalistan terrorist Hardeep Singh Nijjar won’t have any impact on the Indian stock market.
What are the reasons behind the current market collapse?
- The market’s harsh reaction to HDFC Bank’s direct impact following its merger with HDFC Ltd. was the primary cause of the decline. It prevented the banking index from rising 0.7%, which would have been the greatest intraday decrease since late August.
- The overnight weakness in US markets, rising global crude oil prices, and a strengthening US dollar all hurt the Indian stock market.
- Indian market indices closed in the red on Monday, just before a holiday that has been declared for the occasion of Ganesh Chaturthi on Tuesday. Investors are thought to have withdrew part of their funds after the indices reached new highs last week.
- Financial markets also experienced their lowest session since August 3 with a 1.2% decline.
- Oil and gas and other industries, like IT, put additional pressure on the benchmark by losing 0.4% and 0.6%, respectively.
- On numerous block deals, shares of Reliance Industries, one of the individual equities, also decreased by 1.9%.
- Investors should exercise caution as the US Federal Reserve will announce its decision on Wednesday following a two-day meeting. This time, the Fed Reserve is likely to choose to take a break, which further encouraged markets to adopt a hawkish posture.
