Markets settled with sharp losses; Sensex drops 323 points & Nifty ends near 17,400 mark

Domestic benchmarks reversed the intraday gains and settled with half a per cent losses on Wednesday, November 24, 2021. The S&P BSE Sensex lost 323.34 points or 0.55 per cent to close at 58,340.99. The Nifty dropped 88.30 points or 0.50 per cent to 17,415.05. The Nifty Bank lost 169.15 points or 0.45 per cent to settle at 37,441.95.

In the broader markets at BSE, the S&P BSE MidCap fell 0.57 per cent and S&P BSE SmallCap rose 0.44 per cent.

The market breadth was strong. On the BSE, 1,956 shares rose and 1,334 shares fell. On the Nifty 50 index at the NSE, 13 shares advanced and 36 shares declined while one remained unchanged. The top five gainers on Nifty were ONGC (up 4.26 per cent), Adani Ports (up 3.94 per cent), Coal India (up 1.70 per cent), NTPC (up 1.27 per cent) and Kotak Bank (up 1.19 per cent). The top five losers were Eicher Motor (down 2.81 per cent), Tata Consumer (down 2.80 per cent), Maruti (down 2.77 per cent), Grasim (down 2.76 per cent) and Infosys (down 2.69 per cent).

Economy

India has agreed to release 5 million barrels of crude oil from its Strategic Petroleum Reserves. This release will happen in parallel and consultation with other major global energy consumers including the USA, China, Japan and South Korea.

Ministry of Petroleum and Natural Gas in a statement said that India strongly believes that the pricing of liquid hydrocarbons should be reasonable, responsible and be determined by market forces. India has repeatedly expressed concern about the supply of oil being artificially adjusted below demand levels by oil-producing countries, leading to rising prices and negative attendant consequences.

The Ministry said that the Prime Minister has been consistently reviewing the high petroleum and diesel prices domestically. It said, in a bid to control inflationary pressures, the Government of India had reduced the 'central excise duty on petrol by Rs 5 and diesel by Rs 10 on November 3, 2021. It was followed by a reduction in VAT on fuel by many state governments.

In Asia, Singapore's economy grew 7.1 per cent in the third quarter as compared with a year ago, according to the Ministry of Trade and Industry. It was higher than an earlier official advance estimate for 6.5 per cent year-on-year growth.

Japan's factory activity grew at the fastest pace in nearly four years in November. The Au Jibun Bank Flash Japan Manufacturing Purchasing Managers' Index (PMI) rose to a seasonally adjusted 54.2, its fastest pace of expansion since January 2018.

The factors stoking inflation in Europe are becoming more structural and simultaneously affecting economic growth, according to European Central Bank Vice President Luis de Guindos. While supply bottlenecks and higher energy costs are transitory by nature, inflation has not eased as much as the ECB had projected, Mr Guindos said late on Tuesday in Madrid.

The situation is also leading to greater uncertainty in making economic predictions, he said. "The European Central Bank is continuously pointing out that the inflation rebound in recent months is of a transitory nature," Mr Guindos said. "However, we have also seen how in recent months these supply factors are becoming more structural, more permanent." The remarks chime with recent comments by other ECB officials on the risks from the current bout of elevated consumer-price growth -- even as a new wave of Covid-19 sweeps across the continent.