The Indian stock market witnessed a second consecutive day of decline on Tuesday, December 2, as investors chose to lock in profits at elevated levels. The sell-off was fueled by a combination of a weakening Indian rupee and persistent outflows of foreign capital, casting a shadow over trading sentiment.
Market Performance and Key Drivers
The benchmark BSE Sensex dropped 504 points, or 0.59%, to settle at 85,138. Meanwhile, the NSE Nifty 50 index ended the session 144 points, or 0.55%, lower at 26,032. The total market capitalisation of companies listed on the BSE contracted by a significant ₹1.82 lakh crore, falling to ₹472.59 lakh crore.
Ajit Mishra, SVP of Research at Religare Broking Ltd., attributed the downturn to several factors. "The decline was primarily driven by a sharp contraction in the IIP data, weakness in the rupee, and caution ahead of the upcoming US Fed and RBI policy decisions later in the week," he stated. He added that global markets provided little support, with US indices closing lower due to rising treasury yields.
Sectoral Performance and Broader Market
The market's weakness was broad-based. On the weekly expiry day, most sectoral indices moved in tandem with the benchmarks. Banking, financial services, and metal stocks emerged as the top losers. The broader market also reflected the subdued mood, with both the midcap and smallcap indices ending the trading session in negative territory.
All eyes are now firmly set on the Reserve Bank of India's (RBI) upcoming three-day monetary policy meeting, which begins on Wednesday. The central bank's policy announcement is scheduled for Friday, December 5, and is a key event that investors are watching closely for cues on interest rates and economic outlook.
Stocks in the News on December 2
Several companies made significant announcements that are likely to influence their stock movements:
- IRFC: The state-run financier signed a loan agreement with Sumitomo Mitsui Banking Corporation's GIFT City branch for an External Commercial Borrowing (ECB) worth ¥300 million (approx. $300 million).
- IndiGo: The airline received a penalty order of ₹117.52 crore related to input tax credit from tax authorities in Kochi and stated it plans to challenge the order.
- India Cements: Its subsidiaries in Indonesia and Singapore signed a pact to sell their entire stake in PT Adcoal Energindo, Indonesia, for about ₹5.4 crore.
- Hindustan Copper: The PSU inked a Memorandum of Understanding with NTPC Mining Ltd. for collaboration on copper and critical mineral development.
- Canara Bank: The public sector bank raised ₹3,500 crore by issuing Basel III-compliant Additional Tier I bonds.
- KPI Green Energy: Secured a major order from GSECL for the engineering, procurement, and construction of a 142 MW floating solar project on Kadana Dam in Gujarat.
- Motilal Oswal Financial Services: Approved a proposal to issue non-convertible debentures worth up to ₹300 crore.
- CEAT: Its board committee will meet to consider a proposal for issuing NCDs via private placement.
- Maruti Suzuki: The carmaker expanded its electric vehicle portfolio by launching its first electric SUV, the e-Vitara.
- Bikaji Foods: Infused an additional $250,000 into its fully-owned US subsidiary.
The market trajectory in the immediate term is expected to remain volatile as participants await crucial policy decisions from both the RBI and the US Federal Reserve.
