21 Nov 2024, 10:18 AM Indian stock markets witnessed a sharp reversal on Tuesday, as both the Sensex and Nifty slipped into negative territory after starting the day on a positive note.
Early optimism, fueled by supportive global cues and strong domestic data, was overshadowed by intense selling pressure in key sectors, leading to a broad-based decline.
Sensex and Nifty Volatility
The benchmark indices, the BSE Sensex and NSE Nifty 50 opened higher amid hopes of a sustained rally following a period of consolidation.
However, market sentiment quickly turned bearish as investors opted to book profits. By midday, the Sensex had dropped over 300 points, and the Nifty was trading below its crucial support level of 19,600.
Experts attribute this volatility to a combination of factors, including weakness in global markets, rising bond yields, and concerns over corporate earnings in key sectors such as IT and banking.
While initial optimism was driven by reports of easing inflation and robust industrial output, persistent fears of an economic slowdown in major global economies weighed on investor sentiment.
Sectoral Impact on Sensex and Nifty
Selling pressure was evident across most sectors, with heavyweights in IT, metals, and financials dragging the indices down.
On the Sensex, major laggards included tech giants like Infosys and TCS, along with key banking stocks such as HDFC Bank and ICICI Bank.
Similarly, on the Nifty, the metal index saw a significant decline, with Tata Steel and Hindalco among the biggest losers.
Defensive sectors such as FMCG and pharma provided some cushion, with stocks like ITC and Sun Pharma showing resilience. However, the gains were not sufficient to offset the broader market sell-off.
Outlook for Sensex and Nifty
Market analysts believe that the current downturn could be a temporary correction driven by global uncertainties and profit-booking. For the Sensex and Nifty to regain momentum, sustained buying interest is needed, particularly from institutional investors.
Key levels to watch are 65,000 on the Sensex and 19,600 on the Nifty, as these are critical for the indices to reverse their downward trajectory.
Investors are advised to remain cautious and focus on fundamentally strong stocks while keeping an eye on global market trends and domestic macroeconomic indicators.
As earnings season progresses, corporate results and management commentary could play a crucial role in shaping market direction in the coming weeks.
