Benchmark stock market indices opened lower on Thursday , rallying for the 4th straight day.
The S&P BSE was down by 625.09 points to 77,891.40, while the NSE Nifty50 lost 173.90 points to 24,204.20 as of 9:26 am.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said that with total uncertainty becoming the new normal there is no clarity on the near-term direction of the market.
“With the duration of the war going beyond everyone’s initial expectations and the price of Brent crude bouncing back to $103 there is increasing risk to global growth in general and higher risk to India’s macros in particular. If Brent crude remains at an average of $100 for many months India’s growth and corporate earnings will take a hit,” he added.
After the opening bell, Sun Pharmaceutical Industries Ltd and Power Grid Corporation of India Ltd were the only gainers among the early movers, rising 0.35% and 0.33%, respectively.
Tech Mahindra Ltd saw the sharpest fall, dropping 2.43%. Eternal Ltd declined 1.94%, Mahindra and Mahindra Ltd was down 1.91%, Indigo Ltd slipped 1.89%, and Asian Paints Ltd fell 1.71% in early trade.
“The US being a net energy exporter is not impacted by the energy crisis. Corporate earnings in US will continue to be strong. That’s why the S&P 500 and Nasdaq are hitting new record highs. The story will turn out to be different for energy importers like India if Hormuz remains shut for long,” said Vijaykumar.
“A significant trend in the market is the outperformance of the broader market where there is no significant pressure of FII selling. In fact FIIs are buying many stocks in the mid and smallcap segments. Therefore, this outperformance of the broader market is likely to continue,” he added.
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