Mumbai (Maharshtra) [India], December 19 : Indian stock markets tanked sharply on Thursday following the selling pressure in major markets around the globe after the US Fed showed signs of fewer rate cuts next year.
The Nifty 50 index tanked more than 1.33 percent or 321 points to open at 23,877.15 points, while the BSE Sensex was down by 1,153.17 points or 1.44 percent to open at 79,029.03 points.
The major reason for the sharp selling pressure in the opening session is the reduction in the rate cut cycles by the US Federal Reserve, which was earlier expected to implement more rate cuts this year. This led to a fall in major markets globally as the rate cuts were expected to boost the economy and show signs of decreasing inflation.
Ajay Bagga, Banking and Market Expert toldthat "Risk off is hitting all markets today as the Fed projections of rate cuts for 2025 led to a steep sell off in US stocks, Gold, Silver, EM currencies vs the US Dollar and led to bond yields in the US going up. Asian markets are seeing the same sell off today and Indian markets are pointing to a gap down opening due to the weak global cues".
All the sectoral indices were dominated by the bear gang on NSE as all sectors declined sharply soon after the opening session. The highest selling pressure was witnessed in Nifty IT, Nifty Metal, and Nifty PSU Bank.
"The Nifty is slated to open very weak. 24,000 is important support but should we gap down below it, the next critical level lies at the November 28 trough of 23873. Anything under this and the bullish head-and-shoulders pattern with a target of 25500 will have failed and the 23,300 lows will become vulnerable again. Immediate resistance lies at 24500" said Akshay Chinchalkar, Head of Research, Axis Securities.
In the Nifty 50 list, only 3 stocks gained while 47 declined at the time of filing this report. The gainers include Dr. Reddy, Hindustan Unilever, and ITC.
The other Asian markets also followed the downward trend as all major indices were trading in red at the time of filing this report. Japan's Nikkei 225 index was down by 0.96 percent, Hong Kong's Hang Seng index declined 1.06 percent, South Korea's market was also down by 1.58 percent, and the Taiwan Weighted Index was in red with a 1.35 percent decline.
The US markets also declined sharply as the Fed rate cut projections for 2025 led to the fall in indices. The S&P 500 plunged by 2.95 percent, losing 178 points to close at 5,872. Meanwhile, the tech-heavy Nasdaq dropped by 3.28 percent, shedding 658 points to settle at 19,450.
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