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Markets drop in early trade on foreign capital outflows


Representational image only.

Representational image only.
| Photo Credit: Reuters

Equity benchmark indices declined in early trade on November 1 due to weakness in banking, financial, and metal stocks amid unabated foreign fund outflows.

“Investors preferred to remain on the sidelines ahead of the U.S. Federal Reserve’s interest rate decision,” traders said.

The 30-share BSE Sensex declined 193.99 points to 63,680.94. The Nifty slipped 47 points to 19,032.60.

Among the Sensex firms, JSW Steel, Bharti Airtel, Kotak Mahindra Bank, HDFC Bank, Asian Paints, Tata Steel, Power Grid and Nestle were the major laggards. Mahindra & Mahindra, Wipro, HCL Technologies, Bajaj Finserv and Tata Motors were the major gainers.

In Asian markets, Seoul, Tokyo, Shanghai and Hong Kong were trading in the green. The U.S. markets ended in positive territory on October 31. Global oil benchmark Brent crude dipped 0.05% to $87.41 a barrel.

“Foreign Institutional Investors (FIIs) offloaded equities worth ₹696.02 crore on Tuesday,” according to exchange data.

“It is important to understand that equity markets globally are being impacted more by the spike in U.S. bond yields rather than the Israel-Hamas conflict. The U.S. 10-year bond yield above 4.9% will continue to be a major headwind for stock markets, particularly for those in emerging markets. Sustained selling by FIIs is likely to continue weighing on markets,” said V. K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

The BSE benchmark declined 237.72 points or 0.37% to settle at 63,874.93 on Tuesday. The Nifty dipped 61.30 points or 0.32% to 19,079.60.

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