Indian benchmark indices ended down for the third consecutive session on Monday, with Nifty ending below the 10,700-mark, on nervousness as political uncertainty in the US and concern over slowing global growth weighed on investor sentiment.
Overall Asian markets ended mixed in thin pre-Christmas trade as investors fretted about impact of partial US government shutdown and US-China trade tensions. Last week, Dow Jones index in the US experienced its worst week since October 2008 during the financial crisis following a rate hike by the US Federal Reserve and due to fear of extended government shutdown.
Sensex fell about 272 points or 0.8% to close at 35,470.15 and the Nifty fell 90.50 points or 0.8% to close at 10,663.50. Of the 50 Nifty constituents, 36 ended in the red. Indian markets will remain closed on Tuesday on account of Christmas.
Foreign Portfolio Investors net sold Indian shares worth ?577 crore on Monday while Domestic Institutional Investors net purchased local stocks worth ?186 crore, provisional data showed. So far in December, FPIs have been net buyers of Indian share worth ?2,400 crore.
“Global markets are seeing correction especially the US market on concern over slowdown in global growth. If global growth slows down then there is a case for equities to correct,” said Piyush Garg, chief investment officer at ICICI Securities.
Small and Midcaps also faced selling pressure, with BSE MidCap index ending down 0.5% and the SmallCap index falling 1.1%.
Shares of Hero MotoCorp slumped 4% to ?3,178.25 to end as the worst hit on the Sensex after Goldman Sachs downgraded the stock to ‘sell’. Bajaj Auto, NTPC, Housing Development Finance Corporation and Vedanta were the other biggest laggards on the Sensex, ending down 2-3%.
Nifty and Sensex have fallen 2.8% each in the last three days. The fall in the last three days after seven consecutive days of gains previously during which Nifty had gained 4.6% and Sensex rose 4.4%, helped by softening
crude oil prices and Reserve Bank of India’s announcement of higher bond purchases going forward.