Why Did Sensex, Nifty Fall Today? 5 Reasons Behind 7-Day Losing Streak
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Sensex and Nifty extended their losing streak to seven sessions as IT, capital goods and defence stocks weighed on the market, even as banks and gold-financing stocks held up better.
The Indian stock market stayed under pressure on Wednesday, August 19, with the Sensex and Nifty falling for the seventh session in a row. Selling was seen in IT, capital goods and defence stocks, while financial stocks were relatively steady.
The Sensex fell 326 points to 76,910, and the Nifty dropped 77 points to 24,078. The Nifty did manage to stay above 24,000, but the broader market remained weak. As many as 34 Nifty stocks closed lower, with the advance-decline ratio at 1:2.
Reasons Behind The Fall
1. IT stocks give up early gains
IT stocks started the session on a firmer note but lost ground later in the day. The move came after CLSA downgraded several large-cap IT stocks, putting the sector under pressure.
The weakness in some of the larger IT names also weighed on the benchmark indices.
2. Capital goods stocks take a hit
Capital goods stocks were among the bigger losers during the session. Hitachi Energy India and CG Power and Industrial Solutions were among the stocks that declined, adding to the pressure on the industrial segment.
3. Defence stocks see selling
Defence stocks also remained weak. Bharat Dynamics fell around 3%, making it one of the notable losers in the midcap space.
The weakness in defence names came as the Nifty Midcap index fell 131 points to 63,409.
4. Gold financiers slip as gold prices fall
The fall in gold prices put pressure on gold-financing stocks. Manappuram Finance and Muthoot Finance fell by up to 2% during the session.
Financial stocks overall were relatively better placed. The Nifty Bank fell just 23 points to 57,240, ending almost flat.
5. Selling remains broad-based
The weakness was visible across the wider market as well. The advance-decline ratio of 1:2 showed that declining stocks outnumbered gainers by a wide margin.
There were still some stocks that bucked the trend. Bajaj Hindusthan Sugar rose more than 10%, while Oriental Hotels gained 15%. PB Fintech rose more than 2% and Info Edge ended around 2% higher.
The seven-day decline has kept the 24,000 mark on the Nifty in focus. How the index behaves around this level could be important for the market in the next few sessions.
Also Read - Why Are Gold And Silver Prices Falling? MCX Gold, Silver Rates Under Pressure
This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Rochelle Britto has spent 8+ years decoding India's markets, businesses, and consumer economy, reporting for ET Prime and Times Internet along the way, covering the stories behind the numbers.
A Mumbai native and perpetual planner of the next holiday, she stays far, far away from the eternal question, “Where are we going next?” When she's not chasing headlines, she's chasing new cultures, open roads, and a bit of quiet in nature.
