New Delhi [India], October 7 (ANI): Indian stock indices closed in red Monday, logging sixth straight session losses, with analysts attributing the fall to a consolidation after the recent bull run.
Sensex closed at 81,050.00 points, down 638.45 points or 0.78 per cent, while Nifty closed at 24,795.75 points, down 218.85 points or 0.87 per cent. Barring IT, all sectoral indices declined, with Nifty media, metal, PSU bank, oil and gas the top losers.
Nifty bank and mid-cap dipped around 2 per cent.
Over the past week, Sensex and Nifty dipped 4-5 per cent each.
“The Indian markets have entered a consolidation phase with high risk of underperforming to Asian peers. This phase is marked by significant corrections in the broader market due to premium valuations. There is notable global arbitrage activity, with Chinese markets attracting substantial inflows driven by its attractive valuations and stimulus measures,” said Vinod Nair, Head of Research, Geojit Financial Services.
“Investors are reassessing their portfolio positions and FIIs outflows are exacerbated. Amid escalating geopolitical tensions, the surging oil prices poses a further challenge to the domestic economy, in the short-term,” said Vinod Nair, Head of Research, Geojit Financial Services.
The latest decline in the indices is also attributable to escalated tensions in the Middle East after the latest attack on Israel by Iran.
Prior to the latest slump, the US Federal Reserve’s monetary policy committee loosening interest rate by steep 50 basis points, in particular, had been lending fresh support to Indian stocks. The steeper the rate cut in the US, the more the tendency to flight of capital to alternative investment destinations, including India.
Continued buying by foreign portfolio investors (FPIs) also somewhat supported the stock indices. Foreign portfolio investments in the Indian stock market remained positive for the fourth consecutive month through September.
For fresh cues, investors in India will now monitor the RBI monetary policy outcome slated for Wednesday.
The RBI kept the repo rate unchanged at 6.5 per cent, in nine straight meetings. (ANI)
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