The Sensex on Friday declined 305.61 points to 62,978.58 in the early morning trade, while the Nifty slipped 79.65 points to 18,732.85. The rupee, however, rose 18 paise to 81.08 against the US dollar in the early trade.
Among the Sensex constituents, 25 out of 30 were in the red. Mahindra and Mahindra, Hindustan Unilever, Asian Paints, Bajaj Finance and HDFC were the top losers on the Sensex. However, Tech Mahindra, IndusInd Bank, Reliance, Tata Steel and Dr Reddy were trading in positive territory.
The domestic equity markets ended in positive territory for the past eight days till Thursday. Rallying for the eighth day running, the 30-share BSE Sensex had on Thursday climbed 184.54 points or 0.29 per cent to settle at 63,284.19, its fresh record closing high. During the day, it rallied 483.42 points or 0.76 per cent to 63,583.07, its lifetime intra-day peak. In eight days, the BSE benchmark has jumped 2,139.35 points or 3.49 per cent.
The market capitalisation of BSE-listed companies reached a fresh all-time high of Rs 289.88 lakh crore on Thursday following an ongoing rally in equities.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, said, “A major market positive that has helped equity markets globally during the last several days has been the steady decline in the dollar index and US bond yields. This trend continues. The dollar index is now below 105 and the US 10- year bond yield is around 3.43 per cent. Another important data is the declining manufacturing activity in the US in November.”
He added that this negative economic news is paradoxically positive news from the market perspective since it indicates that the US economy is responding to the monetary tightening by the Fed. “So, US inflation is likely to decline further enabling the Fed to slow down rate increases and perhaps pause in Q1 of 2023. This is market positive. Back home, even though there is momentum in our markets, valuations are at elevated levels. Scope for further PE expansion is limited. Therefore, the market is likely to consolidate around the present levels.”
The rupee on Friday strengthened 18 paise to 81.08 against the US dollar in the early trade.
Anand James, chief market strategist at Geojit Financial Services, said, “Early sell-off was strong enough to see the 81 vicinity, which encouraged bargain hunting. However, it will require a push beyond 81.35 to revive upside hopes. Else, expect consolidation today, followed by 80.7 in a few days.”
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