FINAL TRADE: Sensex nosedives 1,272 pts, Nifty ends 368 pts lower at 25,811

Domestic equity benchmarks suffered sharp losses on Monday, reversing course after staging a near one-way rally last week. The 30-share Sensex ended with a cut of 1,272 points or 1.49 per cent at 84,299.78 points, while the Nifty ended below 25,850 mark at 25,811, down 368 points or 1.4 per cent.

Sectorally, the top losers included auto, financial services and realty pack, while amid the stimulus measures in China, metal pack turned out to be the gainer.

Among top Nifty gainers were stocks including JSW Steel, NTPC, Hindalco, Tata Steel and Britannia, while laggards during today's session were Hero MotoCorp, Trent, RIL, Axis Bank and Bharat Electronics.

Here are some of the key factors at play in the market:

Nikkei's fall weigh on the Street 

Japan's Nikkei in today's trade were battered by as much as 5 per cent amid expectations that the country's new ministry favours normalisation of interest rate regime. The speculation lifted the Yen, weighing down the index in return. While globally, the sentiment is around easing monetary policy, the anticipated policy take is weighing on global equities.

Across-the-board sell-off 

Sectorally, all the indices traded with deep cuts of up to 2 per cent on the Realty pack. The losses were however capped amid gains in the consumer durable and metal pack.

Auto pack faces pressure ahead of its September sales

The Nifty Auto index was at the last count was down by 1.75 per cent ahead of its September sales due tomorrow. 

Anand Rathi in its auto sales preview report stated that double-digit 2W wholesale volume y/y growth in Sep’24 is likely to have endured on stocks built up (strong festival expectations), an early festival season and favourable base (Honda).

Tractors are likely to have been positive with good ~10% growth, led by retails (~up double digit) on a good monsoon and favourable base. PV volumes are likely to have grown a little, due to an early festival season and stocks built up despite muted demand, it added.

Nervousness ahead of the US Fed Chair's speech later today

As markets awaited more cues on the interest rate trajectory going ahead, the sentiment remained weak ahead of the key Federal Reserve Powell's speech today kept the markets. 

Crude price trajectory

Zee Business Managing Editor also mentioned that going ahead in case brent crude remains above $76-77 per bbl then it may be a cause for concern for the Indian equities. This is as increasing import cost would weigh on the country's current account deficit. At the last count, Brent crude traded above $73 per bbl.

Technicals

Anand James, Chief Market Strategist, Geojit Financial Services remarked that we expect the begin the week with the prospects of 26600 continuing to be alive, but with a higher chance of volatility stepping up. Though yet another attempt to push higher could be seen, the oscillators still give out the same signals that had triggered a turn lower on Friday. We shall therefore mark 26230 and 26130 as exhaustion points on either side of the initial range. 

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