Sensex, Nifty Snap Two-Day Winning Streak Dragged By Metal & I.T. Stocks

India’s equity benchmarks closed lower, dragged by losses in metal, information technology, healthcare, auto and realty stocks, as surge in energy costs spurred inflation concerns.

The S&P BSE Sensex Index shed 0.93%, the steepest single-day decline since July 19, to 59,189.73. The NSE Nifty 50 Index logged the most single-day loss decline since September 20 to 17,646. Reliance Industries Ltd. contributed the most to the index decline, decreasing 1.9%. SBI Life Insurance Co. had the largest drop, falling 4.0%. Today, 41 of 50 shares fell, while 9 rose.

The broader indices almost mirrored their larger peers with the S&P BSE MidCap shedding 1.2% and S&P BSE SmallCap falling 0.5%. All the 19 sectoral indexes compiled by BSE Ltd. declined, with the S&P BSE Metal index falling nearly 3%.

The market breadth was skewed in favour of bears. About 1,440 stocks advanced, 1,848 declined and 158 remained unchanged.

"A number of macro indicators are close to technically critical levels – potential upside breakouts in Dollar index, Crude and Developed Market bond yields could get confirmed this week. The global backdrop is indeed a somewhat worrisome one with surging energy prices meeting slowing demand conditions, and a global supply chain crunch across basic materials", S Hariharan, Head - Sales Trading, Emkay Global Financial Services, wrote in a note, before adding "the valuation premium of mid & small caps over Nifty stocks are at levels similar to early 2018, implying that incremental money flow is likely to be directed towards large caps".