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Bears are circling Modi stocks as Maharashtra polls approach a tight finish. A relief rally may be on the horizon after seven consecutive sessions of losses, with Nifty futures indicating a strong start and Asian markets trading higher. Despite a more favorable valuation for stocks, small- and mid-cap sectors may face further earnings downgrades.
Indian benchmark indices continued their correction for the sixth consecutive session on November 14, with the Nifty closing at 23,532.70, down 26.35 points or 0.11%. The Sensex fell by 110.64 points, or 0.14%, to 77,580.31. For the week, both indices dropped 2.5%, with sectors like FMCG, power, PSU Bank, and oil & gas declining, while auto, media, and realty sectors saw gains.
The Indian benchmark indices continued their decline for the sixth consecutive session on November 14, with the Nifty closing below 23,550 amid selling pressure in FMCG, PSU Bank, and oil & gas sectors. The Sensex fell by 110.64 points to 77,580.31, while the Nifty dropped 26.35 points to 23,532.70, marking a 2.5% loss for the week. Despite initial gains, selling at higher levels led to a downturn, although buying in realty, auto, and media sectors helped the Nifty close above 23,500 amidst volatility.
The Sensex rose by 266.13 points, or 0.33%, reaching 79,742.76, while the Nifty increased by 109.30 points, or 0.45%, to 24,322.60 amid a favorable market breadth. Nearly four stocks advanced for every one that declined, with 2,320 shares gaining, 612 falling, and 115 remaining unchanged.
Nifty's potential for further gains is under scrutiny as uncertainty surrounding the US elections looms. Market participants are keenly observing how these developments may influence trading patterns and investment strategies. Push notifications for relevant updates are available for those interested.
Indian equity indices closed lower for the second consecutive session on October 31, with the Sensex down 553.12 points at 79,389.06 and the Nifty down 135.50 points at 24,205.35. In October, the BSE Sensex fell by 5.8 percent, while the Nifty50 dropped 6.2 percent, driven by selling in the IT, FMCG, and banking sectors amid mixed global cues.
India's market capitalisation experienced its steepest decline since March 2020, dropping nearly 8% in October, primarily due to significant foreign investor sell-offs. The SENSEX and NIFTY fell over 4.7% and 5.7%, respectively, while broader BSE midcap and smallcap indices declined over 6.7%. This decline resulted in a loss of $37 billion, bringing the market cap down to $4.53 trillion, marking the fifth-largest global decline after Belgium, Portugal, Venezuela, and the Netherlands, according to Bloomberg data.
Indian equities are currently grappling with an earnings slowdown, geopolitical uncertainties, and significant foreign institutional investor selling. While the market correction appears minor compared to previous rallies, there are concerns about potential severe earnings downgrades for mid- and small-cap stocks if macroeconomic conditions weaken. Despite valuations not being inexpensive, there is a case for reallocating investments towards large-cap stocks, viewing the broader market correction as an opportunity for well-researched investments.
Selling pressure on Dalal Street escalated, with benchmark indices declining over 1% amid a broader market selloff. The Nifty 50 index has dropped nearly 3% this week, driven by relentless foreign institutional investor (FII) selling, disappointing Q2 earnings, and global uncertainties. On October 24 alone, FIIs sold equities worth Rs 5,062 crore, contributing to a nearly Rs 1 lakh crore exodus in October, as concerns over urban consumption and demand growth loom large.
Foreign institutional investors have been net sellers for 18 consecutive sessions, shifting their focus to China due to stimulus measures and better valuations. As of October 24, the Sensex and Nifty remained flat, with FMCG and oil & gas stocks dragging down the indices, while financials attempted to recover. The Nifty has declined nearly 2% in the last three sessions and is down 7% since its record high on September 27, impacted by foreign selling and disappointing earnings.
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