Stock Markets Decline as Geopolitical Tensions and US Yields Worry Investors

Mid and small-cap stocks experienced significant declines as well, with the BSE Midcap index falling by 0.52 per cent, and the Smallcap index registering a 0.77 per cent drop.
Stock Market
Stock Market

Benchmark indices followed their week-long declining suit on Wednesday. On the geopolitical front, the decline was largely attributed to the ongoing Israel-Hamas war coupled with the rising US yields. In the domestic sphere, the Q2 earnings of companies failed to cheer the market.

Concluding the day's trading session, the Sensex ended at 64,049.06, indicating a decrease of nearly 523 points, or 0.81 per cent. While, on the other hand, the Nifty 50 closed at 19,122.15, down 159 points, or 0.83 per cent.  

The ongoing Israel-Hamas conflict has created an uncertain environment and heightened worries that it might undermine the global central banks' attempts to control inflation owing to a potential spike in crude oil prices.

The rupee concluded the day at 83.18 against the dollar, marking a marginal 1 paisa increase from the previous day's closing rate of 83.19.

The domestic currency witnessed minimal fluctuations against the US dollar, largely influenced by a sell-off in the domestic equity markets and the relative strength of the US currency in the international market.

Mid and small-cap stocks experienced notable declines as well, with the BSE Midcap index falling by 0.52 per cent, and the Small cap index registering a 0.77 per cent drop.  

Notable gainers included Tata Steel, which observed a 1.08 per cent increase, Coal India with a 0.98 per cent rise, and Hindalco closing the session with a gain of 0.83 per cent. Conversely, within the Nifty 50 index, the top losers were Apollo Hospitals Enterprise, marking a significant 2.41 per cent decline, followed by Adani Enterprises, which experienced a 2.06 per cent decrease, and SBI Life Insurance Company, concluding with a loss of 2.05 per cent.

FIIs have been consistently divesting from the Indian equity market due to the sustained increase in the US dollar's value over recent weeks. Given the situation, there's a likelihood that they are reallocating their investments from emerging markets to alternative assets.

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