Domestic equity markets corrected nearly 2 per cent, closing in the red for three consecutive sessions on Monday, amid volatility due to relentless selling from Foreign Institutional investors (FIIs). The huge correction also comes ahead of Reserve Bank of India's monetary policy committee meeting on Tuesday.  

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The broader Nifty closed near 17,200, while the Sensex corrected by over 1000 points. The two indices settled at 17,213.60 and 57,621.19 respectively to end 1.73% and 1.75% lower on Tuesday.

Santosh Meena, Head of Research, Swastika Investmart Ltd, said this weakness can be attributed to heavy selling by FIIs amid rising US bond yields and crude oil prices. "If we look at the profile of the stocks then there is a sharp cut in FIIs' favorite names such as HDFC twins, ICICI Bank, Infosys, Kotak Bank, Reliance, etc. We can expect large FIIs' selling figure in today's trading session, however, there is a good buying in PSU banks, metal stocks and sugar stocks where earnings were strong," he said. 

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Naveen Kulkarni, Chief Investment Officer, Axis Securities, said we expect that the markets to continue to remain volatile on the back of the recent interest rate movements globally. "Most emerging markets will continue to witness FPI outflows and currency depreciation in the short term. We believe that this volatility should be bought into through regular investments, as earning expectations for Indian corporates remain strong. Some sectors which can perform well in the short-term are banks, commodities and energy," he added.

Meanwhile, all boarder market indices ended in the red as midcap and small cap indices corrected up to 1.5 per cent. Sectorally, Financial services, Nifty Bank, private bank, FMCG and healthcare were seen under maximum pressure.  

Tata Consumer, HDFC Bank, HDFC Life, Britannia, Bajaj Finance, Bajaj Finserv, L&T, Kotak Bank, Wipro, Titan and ICICI Bank were top drags on Monday.  

Powergrid, NTPC, ONGC, State bank, Tata Steel, Ultratech Cement were among a few gainers in a falling market.