MUMBAI: Benchmark indices fell over a per cent each on global cues as Russian forces advanced closer to the Ukraine capital Kyiv and Western powers ratcheted up sanctions against Russia. The Nifty swung almost 200 points between high-low to close down 1.12% at 16605.95 while the Sensex gyrated 735 points intraday before ending lower 1.4% at 778.38, as FIIs net sold shares worth a provisional Rs 4339 crore, taking their total sales this fiscal to Rs 1.07 lakh crore. The session was punctuated by volatility with fear gauge India Vix closing up 2.3% to 29.23. A reading above 20 implies heightened uncertainty.
HDFC Bank, Bajaj Auto, Eveready Industries, Hero Motocorp and Biocon were the main drags on Nifty losing between 1.15% and 3.65% while gainers included Coal India, Tata Steel and Hindalco. “Indian equity benchmarks will continue to remain volatile, with some voices on the Street anticipating lows of 15500 before stability sets in,” said Hormuz Maloo, director, AFco Investments. “The huge volatility has made forecasting ever more difficult but we’re likely to encounter more rough weather, punctuated by a bounce here and there. It will be a sell on rise market. ”
Trade for Thursday implies more wild swing as it coincides with weekly options expiry. Apart from selling in the cash market, FIIs sold index futures worth `3245 crore, implying they expect more downside in the session ahead. “When FIIs sell in cash and in futures they tend to be that much more bearish,” said SK Joshi, ED, Khambatta Securities.
Wednesday’s sale of index futures has made FIIs cumulatively net short index futures 12493 contracts. Brent crude rose to its highest since July 2014 topping $113 a barrel. The rupee fell 36 paise to close at 75.7, partly due to the FII outflows.