On November 7, red color was seen in stock markets around the world. India’s main indices Sensex and Nifty also fell for the third consecutive session today. Although all the sectors were trading in the red, maximum selling was seen in IT shares. The main reason for the selling in IT shares was the decline in Artificial Intelligence (AI) shares globally. Overall the mood of Dalal Street remained bearish.
According to Moneycontrol report, after market opening today, Sensex fell by 543.83 points or 0.65 percent to reach 82,767.18, while Nifty fell by 159.30 points or 0.62 percent to 25,350.40. In the market today, 857 shares rose, 2,107 shares fell and 122 shares were seen without change. With today’s fall, Nifty is on track to register a decline of 1.5 percent this week, which will be the second consecutive week. However, till the time of writing the news, the whole day’s trading is still left.
All sectors remained negative in early trade. The biggest loss was in Nifty IT, in which shares of Coforge, LTIMindtree, HCL Technologies, Mphasis and Persistent Systems fell by 1-3 percent.
Nifty Consumer Durables also remained under pressure as shares of Amber Enterprises fell as much as 12 per cent after a disappointing September quarter performance. The company recorded a net loss of Rs 32.9 crore, compared to a net profit of Rs 19.2 crore a year ago. Margins declined by 120 basis points. Broader markets underperformed major stocks, with midcap and smallcap indices falling up to 1 per cent. Due to slight increase in volatility, nervousness among investors was seen increasing.
Short covering can reverse the trend: VK Vijayakumar
VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said continued selling by foreign institutional investors (FIIs) and their move towards cheaper markets have encouraged them to continue holding short positions in Indian stocks. “Short covering could reverse the trend, but there is no immediate trigger in sight for this. However, markets have an uncanny ability to surprise.”
He further said that this period is a good opportunity for investors to rebalance their portfolio towards reasonably priced large stocks, especially in banking and pharma sectors, where growth prospects are strong.
