|
The equity markets opened lower on Monday as elevated crude oil prices continued to weigh on investor sentiment and limit the scope for a recovery.
The benchmark Nifty 50 opened at 22,524.40, declining 75.60 points or 0.33 per cent, while the BSE Sensex opened at 72,990.04, down 133.79 points or 0.18 per cent; both indices fell further soon after opening. Brent crude oil was trading at USD 114.19 per barrel at the time of reporting, remaining elevated compared to last week amid continuing tensions in West Asia and concerns over energy supplies. V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said that despite a slight cooling in Brent crude prices, the prevailing levels continued to constrain the market's recovery. "Despite the slight cooling in Brent crude prices to below USD 115, the price continues to be too high and, therefore, will constrain any rally from the low level of 22600 which Nifty touched last Friday. Investors should not bother about the index levels in the near-term. Their focus should be on the value buys that have emerged from this correction, even while exercising caution about the macro fallout of the high crude prices, he said. He also highlighted the correction in mid-cap and small-cap stocks, attributing the sharp decline in the broader market to the forced liquidation of margin-funded trades. An important lesson from market experience is that when valuations reach very high levels, a reversion to the mean is inevitable. This was what happened in mid-and small-caps last week, particularly on Friday. The crash in the broader market was mainly due to the forced liquidation of the margin funded trade. The broader market continues to be over-valued, but this sharp correction will open up opportunities in high-growth segments in the broader market, Vijayakumar added. In sectoral trading on the NSE, most major indices opened in the red, with Nifty Media, Nifty Pharma and Nifty Private Bank being the exceptions. Nifty IT fell 2.39 per cent, while Nifty Realty declined 0.92 per cent. Nifty Auto dropped 0.42 per cent, Nifty FMCG fell 0.27 per cent and Nifty PSU Bank lost 0.28 per cent. Among individual stocks, Kotak Bank, Dr Reddy's, Max Healthcare, Sun Pharma and Axis Bank were among the top gainers at the opening. Shriram Finance, Infosys, HCL Tech, Tech Mahindra, Bajaj Finance and NTPC were among the top losers. Meanwhile, gold prices opened marginally higher by 0.29 per cent at Rs 1,42,431 per 10 grams for 24-carat gold. Silver gained 0.67 per cent to Rs 1,97,028 per kg. Other Asian markets opened on a mixed note. Japan's Nikkei 225 declined 0.61 per cent to 62,311, Singapore's Straits Times fell 0.43 per cent to 5,398, and South Korea's KOSPI dropped 1.40 per cent to 5,477. Hong Kong's Hang Seng, however, gained 0.46 per cent to 23,199. (ANI)
|
