Share Market: The Indian stock markets saw a sharp decline from the high level of the day on 4 September today. Both Sensex and Nifty started the business with firmly. The Sensex rose 888.96 points to 81,456.67 in early trade. At the same time, the Nifty jumped 265.7 points to reach the level of 24,980.75. However, after this, the Sensex saw a sharp decline of 750 points from the day high of the day. The Nifty also slipped to below 24,800.
At the end of the trading, the Sensex rose 150.30 points or 0.19% to close at 80,718.01. At the same time, the Nifty rose 19.25 points or 0.08% to close at 24,734.30.
There were 3 major reasons behind this rapid uproar in the stock market today-
1) Profit booking
The biggest reason behind today’s uproar in the stock market was profit booking. The GST Council took several major decisions in a meeting held on Wednesday to give relief to the common man. Everyday things like roti, paratha, hair oil, ice cream and TV will now be cheaper. At the same time, tax on personal health and life insurance has been completely abolished. This comprehensive change created an atmosphere of boom in the stock market. Auto, FMCG and Consumer Durables sector shares saw tremendous purchases.
The shares of Mahindra & Mahindra on the Sensex saw the highest jump of more than 7.5%. Apart from this, legendary shares like Bajaj Finance, Hindustan Unilever, Bajaj Finserv, ITC, Tata Motors and UltraTech Cement also saw a good rise.
However, after noon, the market began in the market, causing the Sensex slip towards the lowest levels of the day. Midcap and smallcap stocks also declined, causing the braid market to reach the red mark.
VK Vijaykumar, Chief Investment Strategist, Chief Investment, GST Council, said, “This decision of the GST Council may lead to a sharp jump and many segments may be more than expected. The GST can also lead to more than expected. I can reach 7 percent. However, despite this initial enthusiasm, tariffs and other structural issues will still affect the market. “
At the same time, Santosh Meena, the research head of the Swastika Investmart, said that the stock market has already included the impact of these announcements in the price. He said, “GST rate cuts can greatly boost demand in the festive season. Sectors like Consumer Durables, Automobile and FMCG are expected to benefit especially from these Allanes. However, shares of companies associated with these sectors have already gained momentum. The tax cuts have already increased. The tax cuts have given the tax cut. How much of the savings give to customers. “
2) mixed global signal
The Asian stock market was trading with a mixed signals today. Shares of China and Hong Kong saw a sharp selling. The Shanghai Composite Index was trading with a decline for the third consecutive day. However, South Korea and Japan’s Nikkei were trading in the 225 index green mark.
Investors’ eyes are now on the meeting of the Federal Reserve Bank to be held later this month. According to the Fedwatch tool of the CME Group, the possibility of cutting interest rates during this meeting is being estimated at 96.6%.
3) Continuous selling of foreign investors
Foreign institutional investors (FIIs) are constantly withdrawing money from the Indian stock market. On Wednesday 3 September, he also withdrawn Rs 1,666.46 crore from the stock market. However, on the other hand, domestic institutional investors (DIS) provided support to the market by purchasing about Rs 2,495.33 crore.
Foreign investors have so far done a huge withdrawal of about Rs 1.3 lakh crore from the stock market so far this year. American tariff concerns and weakness in Indian rupee have weakened the sentiment of foreign investors. Apart from this, the performance of the Indian stock market has been weaker than most of the Asian markets so far this year. This is also an important reason for the concern of foreign investors.
Also read- Impact of GST cut: These 5 shares touched new alltime high, how far can the feeling go now?
Disclaimer: The ideas and investment advice given by experts/brokerage firms on Moneycontrol are their own, not the website and its management. Moneycontrol advises users to consult a certified expert before making any investment decision.