Indian stock markets fell dramatically today, dragged down by losses in IT sectors, as investors fled riskier assets due to fears of a global economic downturn. The NSE Nifty 50 index finished 2.65 percent lower at 15,809, while the Sensex fell over 1,400 points, wiping out most of the previous day’s gains. Asian and European stocks fell today, following a violent overnight selloff on Wall Street that saw the S&P 500 fall the most since June 2020.
The market capitalization of BSE-listed enterprises fell by 6,71,051.73 crore to 2,49,06,394.08 crore, in line with the negative market trend.
All major nifty sub-indices plummeted, with the Nifty IT index losing the most ground, falling 5.74 percent. Surging inflation, supply-chain concerns, and the impact of the Ukraine crisis, according to JP Morgan analysts, will put an end to the economic boom enjoyed by India’s IT services industry during the epidemic. Infosys, Wipro, HCL Technologies, Tech Mahindra, and Tata Consultancy Services (TCS) all dropped between 5% and 6%.
ITC, on the other hand, climbed 3.3 percent and was one of the three gainers on the Nifty after the cigarettes-to-hotel conglomerate announced a jump in March-quarter profit late on Wednesday.
According to analysts, the global economy’s growth pace is slowing due to central banks’ tightening of liquidity. The Russia-Ukraine war is also not abating, which will keep energy and food prices high. Both of these variables hint to a worldwide stagflationary scenario, which could lead to a decrease in discretionary spending. This is increasing volatility in global equity markets, including India. Markets are projected to be turbulent in the short term, but there is still room for improvement in the second half of the fiscal year, after markets factor in the impact of a global recession and increased interest rates.
According to experts, a new down move is probable once the 15735 support level is violated. The downward trend is likely to continue. Once the recent intermediate low of 15735 is breached, the bears will acquire more influence. On the downside, the index might fall to 15600. On the other hand, if the Nifty rises above 15900, it could reach 16000-16100 levels.