Sensex Down 500 pts, Nifty Slides Below 24,550 — Know Key Reasons Behind Today's Fall

The Indian equity markets were trading in red during today’s session as investors sold banking, IT and FMCG stocks in large numbers, moreover, Asian markets remained weak ahead of a closely watched speech by US Federal Reserve Chair Jerome Powell.

Sensex fell 568.40 points or 0.69% to hit an intraday low of 80,762.16, while Nifty shed 172.45 points or 0.69% at 24,494.45.

Power Grid Corporation of India, NTPC, Cipla, IndusInd Bank and Infosys were the top losers, falling by about 1.5%.

Here’s a look at key reasons behind today’s fall

1. Fed Chief’s Speech

Investors are keeping a close watch on US Fed Chair Jerome Powell’s speech, scheduled later in the day. Market experts are awaiting detailed commentary on the future interest rate trajectory after the Fed kept the benchmark rate unchanged.

2.‘Sell India; Buy China’ Strategy

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted the possibility of FPIs diverting their investments into Chinese equities from the Indian market.

He said, “The market appears to be heading for a near-term consolidation phase, with mid and smallcaps continuing to outperform. The robust FII buying that supported largecaps may taper off if a tactical ‘Sell India; Buy China’ trade emerges.”

3. Weak rupee

The domestic currency declined by 32 paise to 85.64 against the greenback, weighing on weak domestic equites.

4. Weak Asian markets

Asian markets looked weak as indices in South Korea, Japan, China, and Hong Kong declined. During the course of the day, US markets ended on a mixed note, giving no respite to risk assets in Asia.