MUMBAI: Stocks saw heavy selloff on Tuesday and indices like the sensex closed lower for the fifth consecutive session weighed in by weak global and domestic cues.
As US President Donald Trump escalated the trade war with like-for-like tariffs on iron and aluminium imports, investors felt jittery globally. The weakness of the rupee, which showed some recovery during the day, and continuous selling by foreign funds, also dampened market sentiment, brokers and analysts said.
As a result, the sensex remained in the red from the start of the day’s session and closed 1,018 points or 1.3% lower at 76,294 points. On the NSE, Nifty saw a similar path and closed 310 points or 1.3% lower at 23,072 points. In the last five sessions, the sensex has lost nearly 2,300 points or 3%.
Foreign investors, like in the past several weeks, led the selling on Tuesday as well that left investors poorer by Rs 9.3 lakh crore with BSE’s market capitalisation at Rs 408.5 lakh crore, exchange data showed.
“The ongoing uncertainty surrounding US trade policies and tariffs, coupled with domestic economic growth concerns and persistent selling by FIIs, is dampening market sentiment, said Vinod Nair, head of research, Geojit Financial Services. “The mid- and small-cap stocks experienced significant declines due to demand concerns and higher valuations,” he said.
On Tuesday, while the blue-chip heavy sensex and Nifty each closed 1.3% lower, BSE’s smallcap index lost 3.4% and the midcap index 2.9%. On the sectoral front, real estate, industrial and healthcare stocks were the most affected. All the sectoral indices on the BSE closed in the red.
Foreign funds continued to lead the day’s selling with a net outflow from the stock market at Rs 4,486 crore, BSE data showed. Although domestic funds were net buyers at Rs 4,002 crore, they were no match for the selling by foreign investors.
Of the 30 sensex stocks, only one – Bharti Airtel – closed higher. Among the ones that closed lower, Reliance Industries, HDFC Bank and L&T contributed the most to the index’s slide.
In the broader market, 3,533 stocks closed lower compared to 479 that closed with gains. Going forward, in the short term, “investors are anticipating the PM’s visit to the US for any potential relief in trade uncertainty, while the US inflation data later today (on Tuesday) will also be a key focus,” Nair said.
