E-Paper
Market in red! Sensex slumps over 700 points, Nifty below 19,000. What is happening?
Market edged sharply lower today majorly due to drags in HDFC Bank after it raised concerns of being hit post merger with HDFC Ltd.
Market in red! Sensex rallied over 700 points behind on Wednesday to 66,958 points, whereas, Nifty dragged down below 19,000 points. Experts believe Sensex is rallying owing to drags in HDFC Bank, after the country's largest private lender flagged a hit to its asset quality post its merger with HDFC Ltd.
As per reports, HDFC Bank's shares sliped nearly by 3.5% after the merger with HDFC Ltd was complete, charting it to Nifty 50's top loser's list. Concern was raised by the owner that the recent hit would affect some key financial ratios such as its net interest margin and non-performing assets.
However, experts said there will be no impact on Indian stock market as a result of straining relations between India and Canada after Trudeau's allegation in connection with pro-Khalistan terrorist Hardeep Singh Nijjar's killing.
What are the causes of market falling off-cliff today?
- The major reason for the fall was due to the brunt market faced after HDFC Bank received a direct hit post its merger with HDFC Ltd. It pulled the overall banking index down by 0.7% which was otherwise on track for its biggest intraday drop since late August.
- Indian stock market took a hit also because of overnight weak US markets as well as rising global crude oil prices while US dollar gains strength.
- Before a gazetted holiday on the ocassion of Ganesh Chaturthi on Tuesday, Indian stock indices on Monday witness a closure in red. It is believed that investors may have taken some of their money out after the indices hit their fresh highs last week.
- Finance markets also fell as much as by 1.2%, worst session since August 3.
- Other sectors such as IT and oil and gas added pressure on the benchmark, falling 0.4% and 0.6%, respectively.
- Shares of Reliance Industries, among individual stocks, also fell by 1.9% on multiple block deals.
Intestors are likely to tread carefully as US Federal Reserve will come up with its outcome after a two-day meeting by Wednesday. The Fed Reserve is expected to opt for a pause this time which further led traders to take hawkish stance.
