Mumbai (Maharashtra) [India], December 3 (ANI): Indian equity indices ended Wednesday in negative territory, impacted by the rupee’s weakness against the US dollar, Foreign Institutional Investor (FII) outflows, and ongoing trade uncertainties.
At the close of trade, the BSE Sensex slipped 31.46 points, or 0.04%, to 85,106.81, while the NSE Nifty fell 46.20 points, or 0.18%, ending at 25,986. All sectoral indices closed in the red, with metals, oil & gas, private banks, consumer durables, and media down 0.5% each.
The Indian rupee breached the 90 mark against the USD on Wednesday morning, hitting a fresh all-time low at 90.21 per US dollar. So far this year, the currency has depreciated by over 5% cumulatively.
Vinod Nair, Head of Research at Geojit Investments Limited, said, “Indian equities continued to consolidate as the rupee slid to a record low, weighed down by FII outflows and ongoing trade uncertainties.” He noted that industrial activity moderated in November, with the manufacturing PMI indicating slower new orders, weaker export demand, and a spike in the trade deficit.
Ponmudi R, CEO of Enrich Money, added, “Equity markets ended lower as the continued slide in the Indian rupee prompted foreign portfolio investors to lock in profits, with the currency weakness weighing on their dollar-adjusted returns.” Sectors that had rallied recently, particularly PSU banks, automobiles, and consumer durables, experienced the heaviest profit-taking.
Earlier, record-low inflation had raised hopes of an RBI rate cut. However, stronger-than-expected Q2 GDP data has introduced fresh uncertainty around the central bank’s policy trajectory, contributing to a cautious investor sentiment. Early selling pressure pulled the indices lower, while steady buying near support levels limited further downside. Nifty attempted to reclaim the 26,000 mark in the final hour, but persistent supply capped the recovery, resulting in a close below this key resistance. The index has logged five consecutive lower closes, reflecting short-term weakness with lower highs and lower lows indicating continued selling pressure.
Enrich Money CEO observed, “For any meaningful recovery and a potential move toward the 26,300 zone, Nifty must decisively reclaim and sustain above 26,100. Until then, the market remains in a corrective and consolidation phase.”
Global markets were mixed as investors assessed the outlook ahead of upcoming Fed and ECB monetary policy decisions amid currency volatility. Japanese bond yields also rose on expectations of BOJ tightening and increased government spending. Analysts highlighted that the RBI’s policy decision this week will be crucial, especially for banks, as the probability of a rate cut has reduced following the strong Q2 GDP data. (ANI)
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