The BSE Sensex on Monday, August 14, declined by about 460 points to 64,862 in the opening trade, owing to pessimism across the Asian indices. The NSE Nifty also declined 154.1 points to 19,274.20 in the early morning trade. The rupee fell 25 paise to its 10-month low of 83.07 against the US dollar in early trade.
Among 30 Sensex companies, 25 were in the red. Top-5 losers included JSW Steel, Tata Motors, SBI, Bajaj Finserv were Tata Steel, declining up to 2.12 per cent.
Prashanth Tapse, senior vice-president (research) of Mehta Equities, said, “Technically speaking, bears are in total control with immediate downside risk at 19,268 mark (NSE), while Nifty could see upward momentum only above the 19,757 mark.”
The dollar index rose to 103 on Monday.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, said the market construct has turned a bit negative. The spike in the dollar index to 103 and the US 10-year bond yield rising to 4.18 are negative for capital flows to emerging markets. The FPI sell figure of Rs 3,073 crore last Friday is in tune with these negative trends.
“The Bank Nifty has been a pressure point for the markets during the last several trading days. The RBI decision to raise the CRR of banks to neutralise the excess liquidity created by the withdrawal of Rs 2000 notes has added to the negative sentiments in the banking sector. However, leading banking stocks would be good bargain buys on market corrections since the fundamentals of the sector remain strong and valuations are fair. Investors should exercise caution for the near term and wait for the market to consolidate,” he said.
On the rupee-dollar exchange rate, Anand James, chief market strategist at Geojit Financial Services, said, “The rupee’s dip to 82.65 found enough support last week, raising hopes of reviving upswing attempts towards 82.90. But, we will wait for a clean break of 83.26 before playing directional upsides. Alternatively, fall back below 82.4 will puncture upside hopes.”