Stock Market Today: 5 reasons why the market crashed, Sensex falls over 1,000 points

Stock Market Today: The local benchmark indices, the Sensex and the Nifty 50, finished with strong losses on Wednesday, December 20, as bears took control of D-Street in the late afternoon hours. Market watchers blamed the drop on profit-taking and saw the correction as long overdue owing to the overvaluation of mid-and small-cap companies.

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Asian stocks mainly rose on Wednesday after Wall Street rose, on optimism that Japan’s actions to keep interest rates low for investors may presage similar developments elsewhere. After two days of increases, US futures increased but oil prices remained almost steady. 

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The US dollar remained stable versus a basket of rivals as traders assessed the likelihood that the Fed would begin decreasing interest rates shortly. Fed officials have been pushing back after three rate cuts were penciled in for 2024 at last week’s Federal Open Market Committee (FOMC) meeting, igniting a rise in financial markets.

The 30-share BSE Sensex fell 1,052.10 points, or 1.47 percent, to 70,385.09, while the Nifty 50 was down 1.62 percent, or 346 points, to 21,106.40. The Nifty 50 has gained approximately 7% in December and is on track to have its best month since July 2022. 

The Nifty Midcap 100 index fell 4.5% from the day’s high, while the Nifty Smallcap 100 index fell 5% from the day’s high to 14,951. IT firms, which derive a large portion of their income from the US market, have gained about 10% in the previous two weeks on predictions of a rate drop in the first half of 2024.

The rupee finished flat versus the US dollar at 83.18 (provisional) after huge selling in equities markets as fears over oil supply via the Red Sea route dampened investor mood.

While the US dollar index below 102 assisted, forex dealers said the Indian rupee was pushed down by foreign cash outflows amid unpredictable crude oil prices. On Wednesday, the dollar index, which measures the strength of the greenback against a basket of six currencies, was trading 0.08 percent higher at 101.87.

“Despite the positive trend in global peers, the domestic market saw a sharp and abrupt sell-off in the second half.” Profit booking from the recent rapid advance has stretched the values of mid- and small-cap firms. The recent increase in petroleum prices has pushed investors to take gains. Most industries had declined, with FMCG, banking, and IT suffering the least,” said Vinod Nair, Head of Research at Geojit Financial Services.

Axpert Media News Desk
Axpert Media News Desk
Axpert Media News Desk is an Internet media Website and our goal is to reach out People all over world with News, Informations & Entertainment. Ect, founder & ceo Krishnaanand

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