BSE benchmark sensex slips nearly 900 points
The BSE benchmark sensex slipped nearly 900 points in intraday trade, reflecting the bearish sentiment in the market. This decline comes as a result of weak global sentiments, including Fitch’s downgrade of the US credit rating from AAA+ to AA+ and weak economic data from eurozone and China.
Nifty falls nearly 270 points
Alongside the sensex, the Nifty also experienced a significant decline, falling nearly 270 points. The decline in both indices indicates a general exhaustion in the market and concerns over high stock valuations.
Analysts express concerns over high stock valuations
Analysts have flagged concerns over high stock valuations, which have contributed to the steady decrease in stock prices in recent sessions. This decline follows a period of bullish trends in the Indian stock market, with both indices reaching new highs just two weeks ago.
Factors contributing to the bullish trend
Several factors contributed to the bullish trend in the Indian stock market, including consistent inflow of foreign portfolio funds, a positive economic outlook, strong global markets, and a relative moderation in inflation. However, profit booking by investors and concerns over high stock valuations have led to the recent decline in stock prices.
“There has clearly been some exhaustion in the market,” said Avinash Gorakshakar, head of research at Mumbai-based Profitmart Securities, reflecting on the current market conditions. “At this level, the index has become a little top-heavy. Overall, the Nifty 50 will struggle as the risk-reward is favorable in only selective pockets.”
Despite the recent decline, experts believe that the Indian stock market still holds potential for selective investments. Investors are advised to carefully analyze the market and identify sectors with favorable risk-reward ratios.
(With inputs from agencies)
- BSE benchmark sensex slipped nearly 900 points
- Nifty fell nearly 270 points
- Fitch’s downgrade of US credit rating and weak economic data from eurozone and China contributed to the decline
- Analysts express concerns over high stock valuations
- Factors contributing to the previous bullish trend included consistent inflow of foreign portfolio funds, positive economic outlook, strong global markets, and relative moderation in inflation
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