Today, the market is seeing a decline for the second consecutive day. The market is currently looking at the low levels of the day. Today, the Nifty has fallen 225 points below 17900 in the fall for the second consecutive day. Weakness of about 400 points is also being seen in Nifty Bank. IT and Financial stocks seem to be getting beaten up the most. Sensex Nifty has slipped nearly 1 per cent. The rise in crude oil prices, the fall in global markets and the possibility of increasing interest rates in the US have put pressure on the Indian markets as well. Let us inform that Nifty was down 1.07 percent and Sensex 0.9 percent in yesterday’s trade on January 18.
Let’s take a look at the reasons for today’s decline
Weak global market
A rise in US Treasury yields and the prospect of a rise in interest rates in the US have seen a sell-off at the global level. US 10-year bond yields hit a 2-year high, a sign that investors are prepared to face further tightening of the Federal Reserve’s monetary policies. The US Fed meeting is on January 25-26.
Crude oil prices rise
Crude oil prices have hit a seven-year high on rising geopolitical tensions in the Middle East and the prospect of further supply problems in an already tight market. Goldman Sachs says that Brent prices can go up to $ 90 per barrel in the first quarter of 2022 and 95 per barrel in the second quarter, while the price of Brent can reach $ 100 per barrel in the last two quarters of 2022.
Goldman Sachs has lowered its Brent oil price for 2022 to Rs 96 per barrel and for 2023 to $105 per barrel from $81 and $85 per barrel earlier.
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rising cases of covid
The cases of COVID are increasing in India and all over the world, due to which there is a possibility of impact on the era of global economy. In 24 hours, 282,970 new cases of corona have been found in India, while 441 people have died due to this.
December quarter results
The early trends of the results season suggest that so far the companies have performed as expected. However, the increase in raw material prices has been seen to put pressure on the margins of the companies. Analysts say that rising cases of COVID and rising crude oil prices may impact the company’s margins in the next quarters.
FII sell-off
After buying around $650 million from January 3 to January 6, foreign institutional investors are seen selling in the Indian markets amid a sell-off in global equity markets. Foreign institutional investors have sold $800 million in Indian markets since January 7.
pre-budget vigil
Before the budget coming on 1 February, investors are looking shocked. The government may target a less ambitious fiscal deficit of 6.3 to 6.5 per cent amid rising cases of COVID. Analysts believe that the reduction in government spending can affect the growth prospects.
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