Benchmark stock market indices closed lower on Monday due to global geopolitical tensions impacting market sentiment. The Indian Rupee reached a record low against the US Dollar, surpassing 95, despite intervention by the Reserve Bank of India.
The S&P BSE Sensex fell by 1,635.67 points to conclude at 71,947.55, while the NSE Nifty50 dropped 488.20 points to finish at 22,331.40.
According to Vinod Nair, Head of Research at Geojit Investments Limited, unresolved global tensions, increasing oil prices, and ongoing FII outflows led the market to end the financial year cautiously.
Nair mentioned that banking stocks suffered notably after the RBI imposed new restrictions on banks’ foreign exchange positions to stabilize the Rupee, resulting in significant declines among major private and public sector lenders.
Following the market close, Tech Mahindra Ltd recorded gains of 1.65%, leading the way, followed by Power Grid Corporation of India Ltd with a 0.27% increase.
Conversely, Bajaj Finance Ltd experienced the steepest decline, dropping by 5.09%. State Bank of India Ltd fell by 3.95%, Indigo Ltd by 3.80%, Bajaj Finserv Ltd by 3.71%, and Axis Bank Ltd by 3.59%, indicating widespread weakness at the start of trading.
Nair emphasized that while current valuations seem more attractive post the recent correction, earnings revisions’ direction will be crucial in determining the market’s trajectory.
He also highlighted that ongoing volatility in oil prices and Rupee depreciation could elevate input costs, posing a risk of near-term earnings downgrades.
Please note that the opinions and recommendations expressed by experts in this article are their own and do not represent those of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any investment decisions.