Stock Market India:
Indian equity benchmarks fell on Monday, but pared their steep losses from earlier in the session as oil prices eased on recession fears fueled by China demand concerns.
The BSE Sensex ended 200.18 points, or 0.34 per cent, lower at 57,991.11, and the broader NSE Nifty index closed with losses of 73.75 points, or 0.43 per cent, at 17,241.
That after the Sensex crashed 825.61 points to 57,365.68, and the Nifty declined 249.95 points to 17,064.70, in early trade.
Both benchmarks recorded their first weekly gain in four on Friday, rising over 1 per cent last week.
Concerns grew that the tightening of central bank policies would have a significant negative impact on the world economy and business earnings, which led to a fourth consecutive day of declines in European stocks and a little fall in US market index futures on Monday.
“Due to lack of positive strength in global markets and persisting worries about more rate hikes by the key central banks going ahead, investors are not taking any chances and steadily trimming their holdings,” said Shrikant Chouhan, Head of Equity Research for Retail at Kotak Securities.
“Caution along with weak market sentiment will prevail as all eyes will be on the US FOMC minutes to be released on Wednesday, which will give some hint about the future rate setting decision by the Fed,” he added.
Crude prices fell ending five straight days of gains, as investors looked to slowing economic activity in China, the world’s biggest crude importer, which revived concerns about a global recession and falling global fuel demand.
“Oil…is getting hit with the triple whammy of China’s economic weakness, US monetary policy tightening and Biden administration SPR intervention,” Stephen Innes, Managing Director at SPI Asset Management, said in a note.
In response to OPEC+’s decision last week to cut their output target by 2 million barrels per day, Mr. Innes was referring to the likelihood of increased releases from the US Strategic Petroleum Reserve (SPR) next month. OPEC+ includes allies such as Russia.
The release of the Indian and US inflation data and the beginning of the third-quarter earnings season will make for an eventful week ahead.
“The narrative will start changing from central banks and inflation, to one of weaker growth and downward earnings revisions that is going to weigh on risk sentiment over coming weeks,” Jefferies strategist Mohit Kumar wrote in a note, according to Bloomberg.
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