Indian equity benchmark indices BSE Sensex and Nifty 50 opened significantly lower on Wednesday
Indian equity benchmark indices BSE Sensex and Nifty 50 opened significantly lower on Wednesday, following the sharp sell off in global markets after weak manufacturing data in the US brought back fears of a recession in the US economy.
At opening bell, the BSE Sensex was down 710 points, or 0.86 per cent, at 81,845, while the Nifty 50 was at 25,104, down 175 points, or 0.69 per cent lower.
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Market View| Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services
Historically, September has been a weak month for global markets. This has been true for the last four years. Going by early trends, this might again turnout to be true this year, too. The selloff in US markets yesterday was triggered by growth concerns.
There are indications of US manufacturing moving into contraction thereby threatening the soft landing expectation, which has been the pillar of support for the mother market US and consequently for other markets, too. Now there is a small question mark about this scenario. More data is needed to confirm this trend.
The buy-on-dips strategy that has been working well in this bull run may play out this time, too. Retail investors waiting for a correction are likely to jump in on dips. Whether the trend will sustain remains to be seen.
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In the present stage of the market where there is no valuation comfort in the broader market, quality largecaps offer safety to long-term investors.
Global Cues
Wall Street closed sharply lower overnight as investors softened their optimism about artificial intelligence.
The Dow Jones Industrial Average dropped 1.51 per cent, to end at 40,936.93; the S&P 500 lost 2.12 per cent, to close at 5,528.93; while the Nasdaq Composite lost 3.26 per cent to close at 17,136.30.
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That set up for a negative lead in Asia, with MSCI’s broadest index of Asia-Pacific shares outside Japan falling 0.44 per cent in early trade, while US stock futures extended their decline.
S&P 500 futures were off 0.1 per cent. Nasdaq futures eased 0.15 per cent.
Markets in Asia-Pacific were down on Wednesday, with Japan’s Nikkei 225 leading the losses in the region. It slid more than 3 per cent, while the broad based Topix was down 2.74 per cent.
South Korea’s Kospi had shed 2.61 per cent at open, while the small cap Kosdaq had dropped 2.94 per cent.
Meanwhile, Australia’s S&P/ASX 200 was down 1.46 per cent, and Hong Kong’s Hang Seng index futures were at 17,487, lower than the HSI’s last close of 17,651.49.
