Mumbai: Indian equity benchmarks fell sharply at open on Thursday, with the Sensex declining over 525 points and the Nifty slipping below 22,600, as elevated crude oil prices and high US bond yields weighed on sentiment amid continued profit booking.
The BSE Sensex was trading at 73,184.19, down 525.50 points or 0.71 per cent, at the time of filing this report. It opened at 73,343.33 against its previous close of 73,709.69. The Nifty 50 was trading at 22,594.50, down 216.85 points or 0.95 per cent, after opening at 22,687.75.
Brent crude rose 1.55 per cent to USD 110.51 per barrel, while US crude oil gained 1.23 per cent to USD 98.34. In US markets, the S&P 500 futures were up 0.58 per cent and Nasdaq futures gained 1.05 per cent, while Dow Jones futures declined 0.29 per cent.
Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said the market was seeing a shift towards large-cap stocks after a period in which mid- and small-cap shares had outperformed.
“The broader market resilience in recent months has been more a function of liquidity than earnings,” he said, adding that the coexistence of overvalued mid- and small-cap stocks, particularly small-caps, and attractively valued large-caps was unlikely to continue for long.
Vijayakumar also flagged elevated crude prices and high US bond yields as external risks that were encouraging bearish positions in the market. He said the trend of investors shifting towards fairly valued large-cap stocks was likely to continue.
Among Sensex constituents, most stocks were trading in the red, with Power Grid, Maruti Suzuki, Mahindra and Mahindra, Tata Steel and Bajaj Finance among the notable losers. Technology stocks showed relative resilience, with Tech Mahindra, Eternal and Infosys in positive territory.
Sectoral indices were largely in the red, with Nifty Auto falling 1.76 per cent and Nifty Metal declining 1.82 per cent. Nifty FMCG slipped 1.15 per cent, while Nifty Pharma fell 1.09 per cent. Nifty Realty declined 1.17 per cent, and Nifty Financial Services and Nifty PSU Bank lost 0.96 per cent and 0.89 per cent, respectively. Nifty IT was flat, while Nifty Media fell 0.39 per cent.
Shrikant Chouhan of Kotak Neo said recent sessions had seen continued profit booking at higher levels. He identified 22,800 and 22,750 as key Nifty support levels, warning that a sustained fall below 22,750 could lead to further weakness towards 22,650-22,500.
“Given the current volatility, level-based trading would be the preferred strategy for day traders,” he said.
Investors will continue to track crude oil prices, global bond yields and institutional flows for direction during the session.