Nifty breaks 15,800 level; Broader markets under pressure

The domestic equity benchmarks extended its intraday low during mid-afternoon trade. The Nifty traded below 15,800 level. All the sectoral indices on the NSE were traded in red, with bank, metal and consumer durables falling the most. Rising global inflation and consequent tightening of monetary policy by major central banks dented the investor sentiment.

At 14:22 IST, the barometer index, S&P BSE Sensex plunged 1,248.84 points or 2.31% to 52,839.55. The Nifty 50 index tumbled 386 points or 2.39% to 15,781.10.

In the broader market, the S&P BSE Mid-Cap index slipped 2.82% while the S&P BSE Small-Cap index fell 2.45%.

The market breadth, indicating the overall health of the market, was weak. On the BSE, 582 shares rose while 2,709 shares fell. A total of 91 shares were unchanged.

Numbers to Track:

The yield on India`s 10-year benchmark federal paper fell to 7.205% as compared with 7.215% at close in the previous trading session.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 77.4675, compared with its close of 77.25 during the previous trading session.

MCX Gold futures for 3 June 2022 settlement fell 0.24% to Rs 50,700.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, rose 0.38% to 104.24.

In the commodities market, Brent crude for July 2022 settlement fell $1.89 or 1.76% at $105.62 a barrel.

Buzzing Index:

The Nifty Bank index fell 3.35% to 33,529.45. The index had risen 1.21% in the past two trading sessions.

Among the components of the Nifty Bank index, Punjab National Bank (PNB) (down 12.24%), Federal Bank (down 6.45%), IndusInd Bank (down 6.01%), IDFC First Bank (down 5.71%) and Bank of Baroda (down 4.25%) were the top losers.

Among the other losers were State Bank of India (SBI) (down 3.55%), Axis Bank (down 3.48%), HDFC Bank (down 3.38%), AU Small Finance Bank (down 2.84%) and Bandhan Bank (down 2.69%).

Earnings Impact:

Birla Corporation declined 4.64% to Rs 915.95 after the company reported 53.4% decrease in consolidated net profit to Rs 138.96 crore in Q4 FY22 as against Rs 298.38 crore in Q4 FY21. Net sales was at Rs 2,264.21 crore for the quarter ended 31 March 2022 as against Rs 2,132.61 crore during the same period in the previous year, registering a growth of 6.2% Y-o-Y (year-on-year). Profit before tax stood at Rs 153.18 crore in the fourth quarter, falling 14.8% from Rs 179.78 crore during the period under review. Profitability was dented after the company reported a 12.7% spike in total expenditure to Rs 2,025.95 crore in Q4 FY22 over Q4 FY21.

Sagar Cements fell 3.78% to Rs 200.95 after the company reported consolidated net loss of Rs 11.51 crore in Q4 March 2022 as against net profit of Rs 48.25 crore in Q4 March 2021. Net sales rose 20.13% to Rs 501.72 crore in Q4 March 2022 over Q4 March 2021. Pre-tax loss stood at Rs 13.38 crore in Q4 March 2022 as against pre-tax profit of Rs 74.97 crore in Q4 March 2021. Sales Volume (MT) rose 10% to 11,27,902 MT in Q4 March 2022 over Q4 March 2021. The company`s plants operated around 62% during the current quarter. Operating EBITDA stood at Rs 61.09 crore for Q4 FY22 and Rs 275.77 crore during FY22, down by 41% and 31%, respectively. EBITDA margin declined by 1,300 bps to 12% for Q4 FY22 (v/s Q4 FY21) while the same declined by 1,200 bps to 17% during FY22 (v/s FY21).

Global Markets:

The Dow Jones Futures were down 148 points, indicating a negative start to the US market.

Europe markets declined across the board while Asia scrips closed in negative territory on Thursday as investors kept an eye on high inflation and tightening monetary policies.

Finland`s President Sauli Niinisto and Prime minister Sanna Marin have called for the country to apply for Nato membership "without delay". Sauli Niinisto and Sanna Marin said in a joint statement they expected a decision in the next few days. The move comes amid a surge in public support for Nato membership following Russia`s invasion of Ukraine. Finland shares a 1,300-km (810-mile) border with Russia.

Adding to the uncertainty for investors are the war in Ukraine and COVID-19 lockdowns in China that threaten to hurt the global economy.

The U.K. economy shrank by 0.1% in March but expanded by 0.8% for the first quarter of 2022 as a whole, official figures showed on Thursday, reportedly missing consensus forecasts and signaling that the worst is yet to come as the country`s escalating cost-of-living crisis bites.

US stocks dropped overnight following the release of the U.S. consumer inflation data. The tech-heavy Nasdaq Composite tanked 3.18% while the broader S&P 500 shed 1.65%. The Dow Jones Industrial Average declined 1.02%.

The U.S. consumer-price index increased 8.3% in April from the same month a year ago, data released Wednesday showed, decelerating from an 8.5% annual rate in March.

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