Mumbai (Maharashtra) [India], September 8 (ANI): Indian benchmark indices closed lower on Tuesday, weighed down by rising crude oil prices as Brent crude neared the $100-per-barrel mark amid escalating tensions in West Asia and the weekly expiry of the Nifty 50 index.
The BSE Sensex closed at 75,577.58, down 555.23 points, or 0.73%, while the Nifty 50 index settled at 23,635.10, declining 144.05 points, or 0.61%.
Investor sentiment remained cautious across Asian markets as higher crude oil prices raised concerns over their impact on inflation and corporate earnings.
Crude prices surged after Saudi Arabia’s Energy Ministry said multiple energy facilities and installations in the southern province of the kingdom came under attack Tuesday morning, resulting in reported injuries.
Brent crude prices surged more than 2% and were trading at around $99 per barrel at the time of reporting.
Vinod Nair, Head of Research at Geojit Investments Limited, said the sharp rally in mid- and small-cap stocks could become difficult to sustain as crude oil prices have breached the $100-per-barrel mark.
“Q1 results did point to improving corporate earnings, but sustaining this optimism may become challenging with crude oil prices breaching $100 per barrel. While selective buying will remain, the ongoing elevated market volatility can persist in the near term, making it prudent for short-term investors to book partial profits,” Nair said.
He added that the sharp outperformance of mid- and small-cap stocks over the past five to six months may be difficult to maintain going forward. From a strategic perspective, he said a greater focus on large-cap stocks and non-equity ETFs appears safer.
Nair also said defensive and deep-value areas such as health care, telecom, FMCG, diversified businesses and IT can continue to provide an edge to portfolios.
Among NSE sectoral indices, Nifty Media surged 1.39%, while Nifty Pharma gained 0.74% and Nifty FMCG rose 0.40%. Nifty Auto edged up 0.10%.
On the other hand, Nifty IT declined 0.41%, Nifty PSU Bank and Nifty Private Bank fell 0.22% each, while Nifty Consumer Durables lost 0.19%. Nifty Oil and Gas declined 0.77%. Nifty Metal was down 0.01%.
Gold prices also remained firm amid heightened uncertainty. At the time of reporting, 24-karat gold was trading at Rs. 1,53,100 per 10 grams, while silver was trading flat at Rs. 2,38,981 per kilogram.
Most major Asian markets also closed lower. Japan’s Nikkei 225 declined 0.96% to close at 65,779, Singapore’s Straits Times fell 0.43% to 5,767, Hong Kong’s Hang Seng declined 0.54% to 25,276, while South Korea’s KOSPI closed 0.59% lower at 6,954. (ANI)
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