Robust selling in Infy, HDFC Bank leads to indices plunging
A weakening rupee and lacklustre macroeconomic data adds to the woes
BENGALURU: The Sensex plunged 1,172 points while the Nifty crashed below the 17,200level on Monday, hammered by robust selling in market heavyweights Infosys and HDFC Bank following their below-estimate results. A weakening rupee and lacklustre macroeconomic data added to the woes, traders said.
Resuming trade after a twoday holiday last week, the BSE Sensex tumbled 1,172.19 points or 2.01% to settle at 57,166.74, marking its fourth straight session of loss.
The broader NSE Nifty plunged 302 points or 1.73% to 17,173.65.
Infosys was the top loser in the Sensex pack, plummeting 7.27%, after the country’s second-largest software services company posted a 12% rise in its March quarter net profit, missing market estimates.
HDFC Bank lost 4.74% after the largest private sector lender on Saturday reported a 23% jump in Q4 standalone net profit, led by lower provisions, even as other metrics such as net interest income came in below expectations.
HDFC, Tech Mahindra, Wipro, TCS, and HCL Tech were the other major laggards.
NTPC, Tata Steel, Maruti, Titan, HUL, Mahindra and Mahindra, and Nestle India were among the gainers, rising as much as 6.11%.
The market breadth was negative, with 20 of the 30 Sensex constituents closing in the red.
“After a long weekend, we witnessed huge fall of 2% in the benchmark index. The fall was mainly because of of below estimate results of Infosys and HDFC Bank and the rising tension between Russia and Ukraine. We expect a further fall in markets in the coming days considering the recent rise of covifd cases in India and rising inflation concerns across the globe,” said Rahul Sharma, research head, Equity 99.
India’s wholesale price-based inflation spiked to a four-month high of 14.55% in March on rising prices of crude oil and other commodities because of disruption in global supply chain in the wake of the Russia-Ukraine war, a development that may prompt the Reserve Bank of India to raise interest rates to contain price rise.
“An unfavourable start to earnings season in heavyweight stocks of IT and banking sector led to heavy sell-off. Lowerthan-expected results prompted the market to worry about the headwinds faced by IT sector like attrition, wage inflation, lower utilszation, and cut in IT spending by industries due to geopolitical and macro issues. The degree of fall is high because the sector was trading at high valuation and risk of a downgrade in outlook has increased,” said Vinod Nair, head of research, Geojit Financial Services.
The BSE smallcap gauge fell 1.01%, while the midcap index lost 0.95%.
As many as 2,062 stocks declined, while 1,462 advanced and 146 remained unchanged.
Among BSE sectoral indices, IT declined the most by 4.76%, followed by teck (4.60%), finance (2.12%), and telecom (1.77%%).
Asian markets closed lower as investors fretted about rising covid-19 cases and lockdowns in China.
Bourses in Europe were shut for Easter holidays.