Bears ruled the Street even as the decline in US 10-year bond yield to 3.75 % and Brent declining to $81 are positives for investors.
Here are 6 key factors dragging Sensex and Nifty lower today:
1) Fed minutes Investors are anxiously awaiting the release of Fed minutes of the December meeting, which would hint whether the US central bank has slowed down its tightening path. “Inflation might prove to be harder to bring down and that should keep the risks elevated that the recession that hits the US economy could be harsher than what most are anticipating. The Fed will remain loud and clear that a lot of work remains to bring down inflation,” said Edward Moya of OANDA.
2) US recession The fears of recession in the US and Europe remain the No. 1 risk for investors in 2023. With the increasing fears around recession, gold prices hit a 6-month high in the international market on Tuesday.
3) Technical factors Technical analysts said the 18,000 level remained as the crucial support zone for Nifty. Nifty’s biggest make-or-break intraday support is now placed at 17971 mark. term, the index is likely to move within the range of 17,950-18,400. A breakout on either side will confirm a directional move,” said Rupak De, Senior Technical Analyst at .
4) Global markets US stocks edged lower on Tuesday with the biggest drags from Tesla and Apple, finishing up the new year’s first trading session with an all too familiar 2022 pattern of volatile moves that trend downward amid worries about high inflation and a possible reflection.
The S&P 500 fell 0.40% while the Nasdaq Composite dropped 0.76%.
In Asia, Japan’s Nikkei lost 1.12%, while Australia’s resource heavy S&P/ASX 200 index rose 1.63%.
5) FII selling According to preliminary data made public on the NSE, foreign institutional investors (FII) were again on the sell side in yesterday’s trade, bringing their last seven days of selling to the tune of Rs 6,605 crore.
6) Rupee The Indian rupee was trading marginally down in the spot market at 82.87 against the US dollar today. The domestic currency had fallen almost below the 83-level following a rally in the US dollar index.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)