Red Stock Market: Know the Key Reasons Why Sensex Dropped to 900 Points Today

Last Update:21 November 2024 13:47 IST

Indian stocks were under pressure due to a number of factors; Know the key factors here

Why is the market closed today?

Comparison indices sensex and Nifty fell 1 percent in today’s intraday trade. Adani group sharesrising geopolitical tensions and ongoing foreign institutional investor (FII) outflows.

BSE Sensex opened at 77,711.11 and fell over 900 points to hit an intraday low of 76,802.73. It showed a slight recovery around 12:35 and was traded at 77,127.42. Meanwhile, NSE Nifty fell 179.75 points to settle at 23,338.75 in early trade.

Indian stocks were under pressure due to a number of factors, the main trigger being the indictment of billionaire Gautam Adani by the US Securities and Exchange Commission (SEC) in a bribery case. Additionally, rising tensions in the Russia-Ukraine conflict and a general sense of weakness in global markets have further weighed on investor confidence.

Market analysts are also closely watching the state assembly election results. Manish Chowdhury, Head of Research at StoxBox, noted: “Given the current market jitters affected by recent global geopolitical developments and the fresh bribery case at Adani, a negative outcome for the ruling Maharashtra government could further dampen market sentiment.”

Reasons Behind the Decline in the Market

Adani Factor

U.S. officials on Wednesday said Adani and seven others, including his nephew Sagar Adani, made nearly 265 payments to Indian government officials to secure contracts expected to generate $2 billion in profits over 20 years, including the development of India’s largest project. He announced that he paid a million dollars in bribes. solar power plant.

This news caused Adani Group shares to fall by up to 20 per cent in intra-day trade, with shares of Adani Energy Solutions, Adani Enterprises, Adani Ports, ACC and Ambuja Cements reaching their respective lower circuit limits. Other Adani Group companies such as Adani Green Energy, Adani Total Gas, Adani Power, NDTV and Adani Wilmar also saw declines ranging from 10 percent to 20 percent.

Rising Geopolitical Tension

The increasing Russia-Ukraine conflict also increased the uneasiness in the market. Ukraine’s use of UK-supplied Storm Shadow missiles and Russia’s recent changes to its nuclear doctrine have increased investors’ uncertainty.

Geojit Financial Services Chief Investment Strategist Dr. VK Vijayakumar said: “Increasing tensions in the Russia-Ukraine war are likely to weigh on market sentiment. “Increasing uncertainty may push market participants to adopt a wait-and-watch approach.”

Foreign Investor Exits

Data from November 18 showed a slowdown in FII sales as domestic institutional investors (DIIs) continued their buying spree. However, FII outflows increased again on November 19, reaching Rs 3,411.73 billion, further weakening market sentiment.

Weak trends in Asian markets also contributed to the decline in India; After the US market closed, Nvidia’s revenue figures were below expectations. While Asian markets Tokyo, Shanghai and Hong Kong saw declines, Seoul continued to remain in the positive zone.

Technical Outlook

According to technical analysts, the key support level for Nifty is 23,588. If the index remains above this level, it may see an increase towards 23.711, 23.904 or 24.027. However, Axis Securities analysts noted that a decline below 23,588 could trigger profit taking and potentially lead to a correction towards 23,395, 23,272 or 23,079 levels.

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