Indian Stock Market Suffers Significant Decline, Unable to Sustain Gains from Initial Rally

Market Update: March 24, 2023

Key Highlights

• The Sensex fell by 900 points from its day's high on March 24, paring gains amid de-escalation hopes after US President Donald Trump hinted at talks with Iran.
• The market's positive sentiment was dented by Iran's denial of talks with the US, coupled with a report that Saudi Arabia and the UAE are inching towards joining the fight against Tehran.

Market Performance

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• The Sensex opened with a 2% gap-up, reaching an intraday high of 74,212.47 at 09:54 am, before falling to 73,389.73, a gain of 693.34 points or 0.95%.
• The Nifty rose by 221.90 points or 0.99% to 22,734.55, with 2,643 shares advancing and 799 shares declining.
• The broader small-caps and mid-caps added 1.6% each, while all 16 major sectors logged gains at the open.

Sectoral Performance

• Bank and auto shares led the market gains, while energy companies Coal India and Power Grid Corp. of India were the worst hit in the index, down around 2% each.

Stock Performance

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• HDFC Bank rose 1.1% after appointing external law firms to review the resignation letter of former part-time chairman Atanu Chakraborty.
• Shriram Finance and Eicher Motors were the top gainers in the Nifty 50 index, up over 3% each.
• Asian Paints rose over 2% after several media reports said the company was planning to raise prices of its products by 6-8%.

Outlook

• Emkay sees a sharp near-term rebound in the Nifty with oil refiners, private banks, non-bank lenders, and autos as "the best ways to play the recovery".
• Indian share benchmarks have fallen about 9.5% this month, as elevated crude prices and energy supply worries battered markets and intensified a foreign exodus.