There is a decline in the stock market.
What was not expected, happened. The Fed cut interest rates by 25 basis points. Which everyone was expecting. But the lack of clarity on whether there will be any cut in the December policy meeting gave a clean bowl to the market players. There were many reasons for the rise in the stock market on Thursday. Fed rates were a big reason. After that, the way the deal has been made between China and America regarding rare earth. It became clear that a big trade had ended. Which works in support of the stock market. But the Fed's indication of rate cut pause in its December policy meeting made all these things lighter.
This is the reason why India's stock market started with a fall on Thursday and reached 500 points in 40 minutes, due to which investors suffered a loss of Rs 2.27 lakh crore in this period. However, experts say that foreign investors had also sold the stock market on Wednesday. The effect of which is also visible in the stock market. On the other hand, the rupee has also fallen against the dollar. Let us try to understand from data and expert opinion what the movement of the stock market is trying to say.
Due to Fed meeting and no possibility of rate cut in December, there is a decline in the domestic stock market. Bombay Stock Exchange's main index Sensex is trading at 84,537.66 points with a fall of 460.45 points at 12 noon. However, during the trading session, the Sensex fell by 530.1 points to 84,467.03 points, which is the lower level of the day. On the other hand, the main index of National Stock Exchange Nifty 50 is also trading with a decline of 142 points at 25,911.10 points. However, during the trading session, Nifty fell by 161.65 points to 25,892.25 points, which is the lower level of the day.
Among the Sensex companies, Sun Pharma, Bharti Airtel, Power Grid, ITC, Tata Steel and Asian Paints were the major laggards. However, Larsen & Toubro, Eternal, Adani Ports and Maruti remained in profit. If we talk about sectoral index, a decline of 0.53 percent is seen in healthcare. On the other hand, a decline of more than 200 points is being seen in IT sector, telecom, auto, bank exchange. The FMCG sector is also trading in decline. However, there is a rise in BSE Mid Cap. On the other hand, BSE Smallcap is trading with a slight decline.
Apart from this, profits were also booked by foreign investors on Wednesday. The effect of which is also visible in the stock market. According to the data, foreign institutional investors (FIIs) sold shares worth Rs 2,540.16 crore on Wednesday. The special thing is that on Tuesday, foreign investors had invested the maximum amount of more than Rs 10 thousand crore in a month in the stock market, breaking the record of 3 months. By the way, in the month of October, foreign investors have invested about Rs 18 thousand crores in the stock market. After three months, overall positive response from foreign investors has been seen in the stock market.
In Asian markets, South Korea's Kospi, Japan's Nikkei 225 index, Shanghai's SSE Composite index and Hong Kong's Hang Seng index were trading in positive territory. American markets closed with mixed sentiment on Wednesday. Global oil benchmark Brent crude fell 0.22 percent to $ 64.78 per barrel. On Wednesday, the 30-share BSE Sensex closed 368.97 points or 0.44 per cent higher at 84,997.13. Nifty rose 117.70 points or 0.45 percent to 26,053.90.
Prashant Tapse, Senior Vice President (Research), Mehta Limited, said that in yesterday's positive session, foreign institutional investors (FIIs) made net selling. Wall Street's overnight halt further heightened the cautious stance, with the Dow slipping briefly after surpassing the 48,000 level, while Fed Chairman Jerome Powell's comments further dampened expectations of an interest rate cut in December, further dampening market sentiment.
VK Vijayakumar, chief investment strategist at Geojit Investments Ltd, said the decision by the Fed to cut interest rates by 25 basis points came as expected and hence, it had no impact on the market, even though the direction of future interest rate changes is not clear. The market will now focus more on the outcome of the Trump-Xi summit in South Korea.
Ponmudi R, CEO of online trading and wealth tech firm Enrich Money, said the US Federal Reserve has cut interest rates by a widely expected 25 basis points. The move confirmed the Fed's dovish stance, but Chairman Jerome Powell's cautious comment that “further cuts in 2025 are not guaranteed” dampened global optimism.
