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Sensex tanks 400 points, Nifty below 12,100: Key factors behind market fall

Only three out of 30 Sensex stocks were trading higher in Friday's session.

ETMarkets.com|
Updated: Nov 29, 2019, 02.45 PM IST
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India will report its GDP growth data for July-September quarter of fiscal 2020 post market hours today.
Indian equity market plunged in the afternoon trade on Friday ahead of the release of September quarter GDP print and amid discouraging cues from global peers.

Analysts expect India to report disappointing Q2 GDP numbers whereas fresh tension between US and China could put the trade deal between them in jeopardy.

BSE flagship Sensex dived over 450 points to as low as 40,664. At 12.19 pm, it was trading 363 points down at 40,776. Its NSE counterpart Nifty was down 102 points at 12,049. Mid and smallcap indices, however, were in the green with Nifty Smallcap adding 0.83 per cent and Nifty Midcap up 0.12 per cent.

In the 30-share pack Sensex, Bharti Airtel was the biggest gainer, up 1.85 per cent at Rs 444.80 followed by NTPC that was up 1.47 per cent at Rs 117.25 and IndusInd Bank that gained 0.43 per cent to Rs 1,575.45. All other stocks in the index were in the red.

Here are the factors affecting market today:

US backs Hong Kong protests
US President signed a law backing Hong Kong protest on Wednesday, irking Beijing. China warned the United States on Thursday it would take "firm counter measures" in response to US legislation backing anti-government protesters. The fresh exchange of salvo has put black clouds over the expected trade deal between both economies. They have been at loggerheads for one-and-a-half year that has impacted the global economy.

India GDP growth print
India will report its GDP growth data for July-September quarter of fiscal 2020 post market hours today. Analysts are expecting a disappointing set of numbers. State Bank of India predicted the growth rate of 4.2 per cent. The bank attributes it to low automobile sales, deceleration in air traffic movements, flattening of core sector growth and declining investment in construction and infrastructure.

India reported GDP growth rate at 5 per cent in April-June quarter, a six-year low.

Technical factors
Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in. said, "Nifty is falling from right resistance point as upsides appears to have stretched with momentum oscillators developing negative divergences."

Besides the last two sessions, price action, Mazhar said, was very narrow and listless though Nifty closed with gains. "Hence, bulls were in need of some sort of setback which appears to have unfolded in today’s session as index started falling from the word go itself," he added.

If this intraday correction forces Nifty to close below 11,990 levels then there will be bright chance of Nifty registering a short term top around Thursday’s high of 12,159, he said, adding, in that scenario ideal target shall be 11,800 on downside.

Global cues
A bleak mood in Asian markets also didn’t help the sentiments on S-Street. MSCI All Country world index, which tracks shares in 49 countries, was down 0.39 per cent at 548.48, less than 0.4 per cent away from all-time peak hit in January last year before the start of US-China trade war.

MSCI's broadest index of Asia-Pacific shares outside Japan fell more than 1 per cent. Hong Kong led the dip with losses of 2 per cent. South Korean shares lost 1.4 per cent and Japan's Nikkei eased 0.5 per cent. China's blue-chips gave up 1.3 per cent a day before the country reports manufacturing activity, which analysts polled by Reuters expect to have shrunk for seventh straight month in November.

European stocks look set to start Friday lower with pan-region Euro Stoxx 50 futures down 0.3 per cent in early trade, following a bleak Asian morning session.
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