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Sensex sheds 275 pts, Nifty holds 10,600; 5 factors that weighed on indices

As many as 29 stocks in the Nifty50 index traded in the red with Infosys falling 4%.

Updated: Nov 21, 2018, 05.07 PM IST
NEW DELHI: Domestic equity indices extended their fall for a second straight session on Wednesday on subdued global cues. The BSE Sensex was down around 340 points or 0.95 per cent at 35,135.80, while the NSE Nifty index was down 87 points or 0.81 per cent at 10,569 at around 10.45 am (IST).

As many as 29 stocks in the Nifty index were trading in the red with Infosys, TCS, Tech Mahindra, Reliance Industries and Power Grid falling up to 4 per cent. On the other hand, Dr Reddy’s Labs, YES Bank, BPCL, IOC and HPCL advanced between 2 per cent and 7 per cent.

Here are the five key factors that dragged market:

Weak global cues
Most of the Asian markets were trading in the red following heavy overnight losses in US stocks. Dow Jones index lost nearly 950 points in the past two trading sessions as US investors continued to be plagued by doubts surrounding slowing global growth, US-China trade relations, and the steady rise in interest rates that can be expected to continue into next year.

Dow dipped 2.21 per cent or 551.80 points to 24,465.64 in the previous trading session. Asian peers, Hang Seng, Nikkei and Shanghai were down up to 1 per cent in morning deals.

GDP growth may ease
Market sentiment also got affected after ratings agency ICRA’s report stated that after the strong upswing in April-June quarter of current financial year (FY19), GDP growth for July-September quarter is expected to dip to 7.2 per cent on account of sluggishness in agriculture and industry. The GDP had grown by a higher than expected 8.2 per cent in the first quarter of FY19 as compared to the year-ago period.

Crude shock
Sentiment also took a hit from reports that India's crude oil imports in October rose to their highest level in at least more than seven years. Crude import in October climbed 10.5 per cent from a year earlier to 21.02 million tonnes.

FII in selling mode
Foreign institutional investors (FIIs) sold shares worth a net of Rs 753.17 crore, while domestic institutional investors (DIIs) offloaded shares worth Rs 44.06 crore Tuesday, as per provisional data.

Technical factor
Nifty50 snapped a three-day winning streak and reversed the formation of higher highs and higher lows on Tuesday to form a ‘Bearish Belt Hold’ pattern on the daily chart.

Mazhar Mohammad, Chief Strategist for Technical Research & Trading Advisory, Chartviewindia on Tuesday said a follow-through selloff from a critical resistance point could mark at least a near-term top for Nifty50 around Monday’s high of 10,774 level, which will be confirmed only on a decisive breach of the 10,600 level.
Given the lost momentum and weak market breadth, the index could slip into consolidation, said Arun Kumar, Market Strategist, Reliance Securities.

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