The major stock index Sensex fell by more than 520 points during early trade on Thursday due to the fall in large stocks such as HDFC, TCS, Infosys and ICICI Bank amid weak global cues. The 30-share BSE Sensex was down 523.14 points or 1.10 per cent at 46,886.79. The NSE Nifty fell 167.80 points or 1.2 percent to 13,799.70 points.

HDFC Bank fell the most by 2.5 percent in the Sensex. Apart from this, HDFC, HCL Tech, Tech Mahindra, Sun Pharma, PowerGrid, Kotak Bank, SBI and Nestle India were the leading losers. On the other hand ONGC, NTPC, Reliance Industries and HUL were in green mark.

Foreign portfolio investors (FPIs) sold shares worth Rs 1,688.22 crore on a gross basis on Wednesday, according to provisional data from the stock market. Global oil benchmark Brent crude futures were down 0.45 per cent to US $ 55.56 a barrel.

On Wednesday, the BSE Sensex fell 938 points to fall below the 47,500 mark due to panic among investors. At the same time, the NSE Nifty fell below the psychological level of 14,000. Sensex and Nifty closed down nearly 2 percent. The Sensex closed down 937.66 points, or 1.94 percent, at 47,409.93. The Nifty fell 271.40 points, or 1.91 percent, to 13,967.50 points. Overall, it lost 2,382.19 points, or 4.78 percent, in four sessions. Similarly, the Nifty has dipped 677.20 points i.e. 4.62 percent in four sessions so far.

Five big reasons for market decline

1. The Union Budget will be presented on February 1. Earlier investors are nervous.

2. Investors are making profits by selling high-value shares before the budget. This dominates the selling in the market.
3. Sensex-Nifty impact of decline in heavyweight shares Reliance, TCS, HDFC Bank, Bajaj Finance etc.

4. Reduced confidence in banking and finance companies, led to a sell-off that broke the market.
5. There is a monthly expiry of January’s futures trading on Thursday, even before the traders in the market are reaping huge profits.

The effect of selling by foreign investors also

According to the data available with the stock market, foreign investors sold shares worth Rs 765.30 crore on Monday on a net basis. Among the 30 Sensex stocks, 24 were at a loss while 6 were at a profit. According to analysts, investors preferred settlement of deals in futures and options segments and profit booking ahead of the budget to be presented next week.

Fluctuations will continue till budget

According to experts, sharp fluctuations in the stock market are likely to continue till the budget. Siddharth Khemka, head of retail research, Motilal Oswal Financial Services Ltd, said that in the coming days, the market could be in turmoil before the Union Budget and monthly deals expire. Quarter notches of companies will also increase market volatility. The Federal Reserve’s monetary policy is also to be announced this week.

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