The domestic benchmark equity indices, Sensex and Nifty 50, experienced a significant downturn in Wednesday’s session, driven by heavy selling in PSU banks, realty, auto, oil, and gas stocks, amid a lack of clear direction.
Analysts attribute this sharp fall to investors booking profits following substantial gains, coupled with increased volatility as traders roll over holdings ahead of Thursday’s F&O expiry.
Furthermore, with 90 stocks trading lower and the Nifty Midcap index plummeting by over 1,000 points, concerns about market direction intensified.
Factors Behind the Market Decline:
- Foreign Institutional Investors (FIIs) Selling: FIIs have been major net sellers, with month-to-date net sales amounting to ₹17,650 crore. In contrast, domestic institutional investors (DIIs) have been net buyers, purchasing ₹23,782 crore worth of stocks so far this month.
- Key Economic Data: Global markets have been grappling with uncertainty ahead of crucial US economic indicators, including the second estimate of GDP, PCE price index data, and manufacturing PMI numbers. Additionally, concerns arise as the US government faces a potential partial shutdown on March 1st in the absence of a spending bill.
