Market Midday 3 June: Sensex Drops, Nifty 50 Slides On Escalating US-Iran Tensions

Indian benchmark equity indices traded lower on Wednesday. They were dragged down by a sharp selloff in information technology stocks. This after fresh concerns emerged over the US-Iran situation. At 12:42 pm:

• The Nifty 50 was down 0.64%

• The Sensex was down 0.74%

Heat Across Broader Markets And Sectoral Indices

Losses were also witnessed in broader markets. The Nifty Midcap 100 and Nifty Smallcap 100 were down 0.81% and 0.72%, respectively, at 12:44 pm.

The IT pack led the decline among sectoral indices. The Nifty IT index was down more than 5%, at 12:45 pm, making it the worst-performing sector on the National Stock Exchange. Underperformance was also witnessed in the Nifty Realty and Nifty PSU Bank.

Global And Domestic Cues

Market participants tracked developments in West Asia after comments from US Secretary of State Marco Rubio raised fresh concerns about the prospects of a near-term peace agreement between the US and Iran.

Rubio, in his first appearance before the Senate Foreign Relations Committee, said Iran had mined a large section of the Strait of Hormuz and had fired at commercial ships. On the domestic front, investors turned their attention to the Reserve Bank of India's Monetary Policy Committee meeting, which began today.

Top Stocks On Nifty 50

At 12:47 pm, the top five stocks on the Nifty 50 index were:

• Apollo Hospitals Enterprise Ltd

• Max Healthcare Institute Ltd

• Trent Ltd.

• Power Grid Corporation of India

• Maruti Suzuki India Ltd

Stock-Specific Action

• Vedanta and Hindustan Zinc shares declined 1% each in intraday trade after the former confirmed a visit from the Enforcement Directorate to some of its offices.

• Infosys, TCS, Tech Mahindra, Persistent Systems and Coforge shares fell up to 7% in early trade after a strong rally in the last two trading sessions.

• NHPC shares jumped over 5% in early trade with the opening of the government's offer for sale worth ₹ 4,300 crore for retail investors.

• InterGlobe Aviation, IndiGo's operator, shares fell more than 1% in early trade post suspension of its flights to and from Manchester from 31 August.

Other Crucial Developments

Some of the other major developments till now include:

• Moderation of trading activity in futures and options (F&O) in May, with industry-wide daily premium turnover standing at ₹96,916 crore in May as against ₹97,637 crore in April.

• Alkem Laboratories announced the launch of semaglutide in single-shot, pre-filled syringes in India at a starting price of ₹350 per unit.

Also Read - US Proposes 12.5% Duty On India Over Forced Labour Gaps; Move Complicates Bilateral Trade Talks

Afternoon Trade Outlook

Market participants are likely to watch whether selling pressure in technology shares eases during afternoon trade. Flows in heavyweight stocks and reactions to global developments could determine whether benchmarks recover some losses or extend their decline.

Sources:

Business Standard

CNBC TV18

Moneycontrol