The Sensex, which saw an intra-day low of 84,238, managed to rally to a high of 84,780, before faltering and closing 78 points lower at 84,482. This marks the fourth consecutive day of losses for the Sensex, which has declined by 785 points during this period.
On the other hand, the NSE Nifty 50 dropped 3 points to settle at 24,815.55, retreating from its earlier high of 25,902. While some sectors showed resilience, the overall mood remained cautious in the broader market.
The broader market mirrored this sentiment, with the BSE MidCap index ending flat and BSE SmallCap index declining by 0.3%.
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Impact on the stock market
Sector-wise performance
The market showed mixed results across sectors. IT stocks emerged as the winners, with the BSE IT index climbing over 1%. TCS, Tech Mahindra, and Infosys were the top gainers within the Sensex pack, with gains of 2%, 1.7%, and 1.7% respectively. Adani Ports, HCL Technologies, and Axis Bank were also notable positive movers.
The losses in sectors such as auto, metal, and pharma weighed heavily on the market. The BSE Power index dipped 1%, and the BSE Auto index fell 0.5%. Stocks like Sun Pharma, Tata Steel, Power Grid, Asian Paints, Larsen & Toubro, and NTPC were among the top losers.
| Sector/Index | Performance |
| IT & BPM sector | 1.21% |
| Healthcare sector | -0.10% |
| Oil & Gas sector | -0.33% |
| Real estate sector | 0.34% |
| PSU Bank in India | 0.09% |
Top gainers today
| Company | Share Price (in ₹) | Change % |
| Interglobe Aviation | 5,115.50 | 2.71 |
| TCS | 3,280.80 | 1.96 |
| Max Healthcare | 1,048.50 | 1.69 |
| Tech Mahindra | 1,605.60 | 1.66 |
| Infosys | 1,626.80 | 1.55 |
Top losers today
| Company | Share Price (in ₹) | Change % |
| Sun Pharma | 1,745.90 | -2.62 |
| Tata Steel | 168.12 | -1.30 |
| Power Grid Corp | 257.95 | -1.21 |
| Asian Paints | 2,759.70 | -0.93 |
| NTPC | 318.50 | -0.86 |
Market aftermath: Impact on stocks
Auto stocks face continued pressure
Auto stocks have been under sustained pressure, with the Nifty Auto index dropping by 2% to a one-month low of 27,013.75. This marks the fourth consecutive day of declines for the sector. The fall can be attributed to demand concerns, as well as broader market risks, including global uncertainties and concerns over economic growth.
Investors seem to be cautious, with rising inventories at dealerships and moderating sales volumes. Samvardhana Motherson International and UNO Minda both saw a drop of over 2%. TVS Motor Company, Hero MotoCorp, and Exide Industries also fell by over 1%. Hero MotoCorp saw a significant 5% drop following a downgrade by Jefferies, which cited a plunge in the company’s market share and declining sales in key segments.
While the broader market has shown a reset of sentiment, there are still underlying demand drivers like urban discretionary spending and improving rural trends. For long-term investors, patience is key, as select opportunities may emerge once the dust settles.
LG Electronics India: Weaker demand outlook
Shares of LG Electronics India closed nearly 2% lower after a report from ICICI Securities highlighted a weak demand outlook for the company in the December quarter. ICICI Securities pointed out that the demand for products like air conditioners, televisions, and appliances has slowed down post-festive season, with primary and secondary sales expected to be subdued.
Despite the near-term weakness, ICICI Securities maintained a ‘buy’ rating on the stock, with a target price of Rs 1,875, citing the company’s strong medium-term prospects, particularly its market share gains in the air conditioner segment. However, investors seem to be cautious in the short term, as the stock has fallen 3.14% over the past three days.
Sun Pharma: A setback after FDA warning
Sun Pharmaceutical Industries faced a major setback today as its stock dropped by 3% following news that the US FDA had classified its Baska facility in Gujarat as ‘official action indicated’ (OAI). This classification means that the FDA may withhold approval for any pending product applications from the facility until the outstanding compliance issues are resolved.
The news sent shockwaves through the market, as the Baska facility is crucial for the company’s injectable generic filings in the US. Sun Pharma reassured investors that it continues to manufacture and supply approved products from the facility, but analysts warn that this could delay new product approvals and negatively impact the company’s future earnings. The stock closed at Rs 1,738, marking a one-month low, and over 2 million shares changed hands on the NSE.
Crude oil: Supply risks drive prices higher
The global oil market saw a surge in prices today due to concerns over potential supply disruptions, particularly from Venezuela and Russia. Crude oil futures were higher in early morning trading, with Brent crude at $60.07, up by 0.65%, and WTI crude at $56.24, up by 0.77%.
The market is particularly worried about the impact of the US blockade on sanctioned oil tankers entering and leaving Venezuela, potentially affecting 600,000 barrels per day of exports, mostly destined for China. The US is also preparing stricter sanctions on Russia’s energy sector, which could further disrupt global oil supply if no peace deal is reached with Ukraine.
Despite these supply concerns, US oil inventories showed a much smaller decline than expected, with the Energy Information Administration (EIA) reporting a decrease of just 1.3 million barrels for the week ending December 12. This has contributed to some uncertainty in the market, as traders weigh supply risks against growing global oil inventories.
Conclusion
The Indian stock market today was a tale of mixed results, with the IT sector showing strength, while auto, metal, and pharma stocks faced pressure. The broader market sentiment remains cautious, particularly in the auto sector, where demand concerns continue to weigh heavily on investors. LG Electronics and Sun Pharma also faced challenges, as weaker demand and regulatory setbacks impacted their stocks.
Meanwhile, the oil market remains volatile, driven by concerns over supply disruptions from Venezuela and Russia, which continue to affect global oil prices. For investors, it’s crucial to stay alert and look for stock-specific opportunities, as broader market trends continue to evolve. Patience and selectivity in investment choices remain key to navigating these uncertain times.
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