The two-day rally was abruptly cut short on Wednesday as equity benchmarks declined nearly one and half per cent, tracking weakness in the global markets. The global market was jittery as US Federal Reserve Chair Jerome Powell is scheduled to start a two-day testimony to Congress later in the day. The investors were spooked as they look for more clues on if the Fed will deliver another interest rate hike of 75 basis points. 

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Meanwhile, weakness in the broader market and massive profit booking in Metal, Realty, Energy and media stocks pulled down the market. In the broader market Nifty midcap and small cap declined by 1.6% and 1.4% respectively as India Volatility Index (VIX) settled around 21-mark.  

Among sectoral indices, Nifty Metal fell by nearly 5%, Media dropped 3.5% and Oil & Gas and Realty stocks saw a cut of over two percent as all other sectoral indices slipped in the red.  

Earlier, the benchmarks Nifty 50 ended near 15, 400, while the Sensex declined by more than 700 points to settle around 51,800.  

As the market rally was short-lived, here is what experts say about current trends in the market: 

Ajit Mishra, VP - Research, Religare Broking Ltd 

After a breather, bears took tight control over markets as it ended with sharp losses. On Thursday, June 23, the markets will first react to the Fed chairman speech scheduled tonight.  Besides, progress on monsoon, crude price and currency movement will be key monitorable.

We reiterate our cautious stance on the markets and expect volatility to remain high in the near term. Meanwhile, traders are advised to keep a hedge position while investors should focus on stock selection. 

Vinod Nair, Head of Research at Geojit Financial Services. 

The short-lived pull-back rally displays the level of uncertainty in today’s market. The weakness of the global market due to quantitative tightening pulled the market down. The US Fed Chair’s testimony later in the day will be keenly watched for clues about the central banks’ future dot-plot. 

V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services 

There is no economic news, except the softness in crude, to sustain the rally. There is no reason for FIIs to change their selling strategy since the dollar continues to be strong and US bond yields are attractive and expected to rise further.  

The large-caps which bounced back sharply yesterday are fundamentally strong stocks. Therefore, the best investment strategy now should be to buy these high-quality names in small quantities, on dips.  

Rupak De, Senior Technical Analyst at LKP Securities 

Nifty slipped lower after a volatile trading session. On the higher end, 15500 remains a level of resistance. The trend is likely to remain weak as long as the Nifty remains below 15500. On the lower end, support is visible at 15300. 

(Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)