The domestic equity market logged its biggest single-day fall in six weeks on profit booking at higher levels, as surge in crude oil prices stoked fears of rise in inflation back home. The BSE benchmark Sensex ended at 33,370.76 today, down -1.07 per cent or 360.43 points, while the Nifty50 closed at 10,350.15 today, down -0.97 per cent or 101.65 points, with 13 of the 50 constituents ending in the green and 37 in the red. Sensex and Nifty both had hit their fresh all-time intraday highs in trade yesterday.
Continuing with the negative bias that had come in late yesterday, the benchmark indices remained under pressure at closing with profit-booking in banks, oil & gas, banking & financials, metals and auto stocks. Bonds and the rupee also fell after oil prices surged overnight to their highest since mid-2015, raising concerns about the inflation outlook. The rise in oil prices is seen as likely to prevent the Reserve Bank of India from cutting interest rates anytime soon, even as economic growth has slowed to a three-year low, thus removing a potential trigger for markets.
The Nifty50 saw sustained selling throughout the session today and ended at the day's low. In the process, it formed a 'Long Black Day' on the daily chart. The index violated the trend of forming higher highs and higher lows and fell in intraday almost to its 13-day EMA at around 10,334. Analysts said the short-term indicators are turning in favour of the bears. If the index fails to restrict the fall, a steep drop towards the 20-day moving average of 10,274 is likely. On the upside, a hurdle is seen at the 10,450 level.