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Market Report

Monday, 04-Jan-2016

NSE

  • The S&P BSE Sensex broke below its crucial psychological support level of 26,000, led by losses in bank, realty, IT, capital goods and telecom stocks. It finally closed 537.55 points, or -2.05 per cent, lower at 25,623.35 today. The Nifty50 finally closed 171.90 points or -2.16 per cent down at 7,791.30 today, having lost both the psychological levels of 7,900 and 7,800. It hit a low of 7,781.10 and a high of 7,937.55 during the day.

  • Benchmark shares indices crashed over 2%, amid a sell-off in Asia and Europe, after suspension of trading in Chinese shares post the sharp -6.85 per cent plunge in Shanghai Composite. The domestic equity market came under the bear grip on fears of further economic slowdown in China. Further, geopolitical tensions in the Middle-East also dampened sentiment.

  • India's own manufacturing sector output also contracted for the first time in over two years, dipping to a 28-month low in December, from 50.3 in November to 49.1 in December. This is the lowest level for the index since March 2013. This also contributed to taday's fall. Most other Asian and European markets saw rampant selling today.

  • Slowdown fears in the world's second largest economy and a further devaluation of its currency are keeping markets across the globe on the edge. But analysts say it was more of a kneejerk reaction, and investors should not try and go short on the market after today's crash. There might be a couple of days of more weakness, but it is still better to stand on the sidelines. It's not the time to short the market, because the cuts are already there. If traders go short from current level, they could get caught on the wrong side of the trade in case there is a whipsaw and the market moves back, experts cautioned.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)