NEW DELHI: The festive season has started on a sombre note for equity investors as they have lost nearly Rs 15 lakh crore in the past five sessions amid an ongoing period of sell-off since the start of the Israel-Hamas conflict. The market is also facing pressure from surging bond yields and mixed set of quarter earnings by companies.
The BSE Sensex has shed 2,326 points or 3.50% in the last five sessions while the Nifty50 has fallen 670 points or 3.39% during the period. On Wednesday, the 50-share Nifty fell 159.60 points to close at 19,122 and the Sensex plunged 522.82 points to 64,049. In the last five sessions, market cap of BSE-listed firms, which reflects the shareholders’ cumulative wealth, came down to Rs 309.08 lakh crore from Rs 323.82 lakh crore five sessions ago, an erosion of Rs 14.74 lakh crore.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, said the uncertainties associated with the Israel-Hamas conflict will continue to weigh on markets in the near term. He added that a piece of positive news like the fall in the US bond yields and weakening crude can help market revive but it may not sustain given uncertainty surrounding the West Asian conflict.
On Wednesday, there was a softening in crude prices and the 10-year US treasuries. Yield on Wednesday was at 4.86% after surpassing the 5% mark on Monday for the first time since 2007. When yield rises, investors tend to transfer their exposure from riskier assets like equities to bonds. FIIs sold (net) Rs 4,237 crore on Wednesday. Some experts note the current headwinds from the global cues are allowing investors to cut their exposure to the expensive Indian market. Nifty50, trading at a trailing 12-month (TTM) price-to-earnings (P/E) multiple of 22.22 as of October 23, is one of the most expensive equity benchmarks in the world.
The September quarter earnings of India Inc, especially of IT heavyweights, have failed to bring cheers in the street and have dampened the overall mood in the market. Santosh Meena, head of research, Swastika Investmart, said domestic market is undergoing a correction, and even the previously outperforming broader market segments are now seeing profit-taking, which many had anticipated. The mid-cap and small-cap indexes have fallen about 3-4% in the past two sessions.
Tech Mahindra Q2 net profit down 62% to Rs 494 crore
BENGALURU: Tech Mahindra on Wednesday posted a 61.6% year-on-year (YoY) fall in its consolidated net profit at Rs 494 crore for the second quarter of FY24. Revenue for Q2 stood at Rs 12,864 crore, down 2% YoY. CP Gurnani, MD and CEO, Tech Mahindra, said, “The year is being characterised by a challenging demand environment and prolonged macro uncertainties. We have doubled down our strategy of working closely with clients, helping them to streamline operations.”
