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Equities end down on sell-off in IT, pharma stocks

Nifty IT index closed 1.43 per cent down and BSE IT index ended 1.63 per cent lower, whereas, Nifty Pharma and BSE Cons Durables closed 1.29 per cent and 0.76 per cent, respectively, down.

Mumbai: Benchmark indices ended sharply down on Wednesday with Sensex closing over 400 points down and Nifty over 100 points down, due to sell-off in IT and pharma stocks.

At the close, Sensex ended 412.96 points, or 0.68 per cent, down at 59,934.01, and Nifty closed 126.35 points, or 0.70 per cent, down at 17,877.40.

Nifty IT index closed 1.43 per cent down and BSE IT index ended 1.63 per cent lower, whereas, Nifty Pharma and BSE Cons Durables closed 1.29 per cent and 0.76 per cent, respectively, down.

A total of 1,796 shares have declined, 1,698 shares advanced, and 126 remained unchanged.

“Defying the positive trend of global markets, domestic indices shed early gains, dragged by losses in IT and pharma sectors, while mid and small caps outperformed. Fears of a recession in the global economy exacerbated selling pressure in IT and pharma stocks,” said Vinod Nair, Head of Research at Geojit Financial Services.

Global stock markets were mixed on Thursday as the likelihood of a further jump in global borrowing costs, including a possible 100 basis point US rate hike next week, kept the bears on the prowl.

Fitch now expects world GDP to grow by 2.4 per cent in 2022 – revised down by 0.5 percentage points – and by just 1.7 per cent in 2023, a cut of 1 percentage point. The eurozone and UK are now expected to enter recession later this year and Fitch forecasts that the US will suffer a mild recession in mid-2023.

Fitch Ratings has slashed its growth forecast for India for the current fiscal year to 7 percent from the previous estimate of 7.8 percent. The ratings agency also cut its GDP growth forecast for the next fiscal year to 6.7 percent from the earlier estimate of 7.4 percent.

“Nifty corrected once again from above 18,000 level and underperformed the other markets for a change. Broad markets continues to lag while largecaps seemed to be under mild selling pressure. 18,096-17,771 could be the band for the Nifty in the near term,” said Deepak Jasani, Head of Retail Research, HDFC Securities.

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