Midday: Sensex Down 720 pts, Nifty Drops 155 pts; Pharma Bucks Trend

Mumbai, April 23: Indian benchmarks remained firmly in the red for most of the morning session on Thursday. Deepening worries over the Iran-US spat, which showed no signs of de-escalating overnight, along with oil continuing to trade above $100 per barrel weighed on investor sentiment and sent the Sensex and Nifty further into negative territory at the day’s peak losses.

BSE’s 30-share Sensex was trading at 77,796.01 at 11: 53 am on Thursday, down 720.48 points or 0.92% from Wednesday’s close. The wider NSE Nifty 50 traded at 24,222.45, down 155 points or 0.64%, with both benchmarks failing to recover much ground from their morning open losses. Financials, autos and consumer stocks were among the worst performers on Thursday while pharma and energy were exceptions.

Gainers

Pharma stocks were the top gainers on the Sensex Thursday afternoon with Dr. Reddy’s Laboratories leading the recovery. Shares of Dr. Reddy’s zoomed 6.61% to ₹1,297.40 — its intraday high was ₹1,313 and low was ₹1,217.50 — rotating out of cyclicals. Shares of Cipla rose 4.06% to ₹1,286.50 — high was ₹1,295 and low ₹1,227.60 — amid defensive buying in pharma stocks. Jio Financial Services advanced 3.22% to ₹246.20 with a high of ₹247.42 and low of ₹238.54, followed by Adani Enterprises (up 2.59%) and ONGC (up 1.36%) as oil moving past $100 spurred buying in energy names.

Laggards

State Bank of India Insurance was the biggest loser on the Sensex Thursday afternoon as it shed 2.99% to ₹1,828.40 — a session high of ₹1,886.70 and low of ₹1,826 — extending declines on weakness in financials after money rate futures moved past 6%. Shares of Mahindra & Mahindra tumbled 2.92% to ₹3,057.80 with a high of ₹3,114.70 and low of ₹3,054 as investors dumped auto stocks on higher oil worries. Bajaj Finance lost 2.56%, Trent slipped 2.48% on result-day consolidation despite the brokerage beat-and-raise Q4 results, and Bajaj Finserv fell 2.39% for a clean sweep of financial sector names among the Sensex losers Thursday afternoon.

Iran-US Conflict Update

The Iran-US conflict escalated once again on Wednesday with Iran seizing two container ships transiting the Strait of Hormuz — its first vessels since the war started — just hours after US President Donald Trump announced — unilaterally and without Iranian input — that he would extend the two-week-old ceasefire while the Iranians put forward a proposal for peace. The US military simultaneously seized at least three Iranian-flagged tankers floating in Asian waters off India, Malaysia and Sri Lanka and towed them away from their moorings in what could be seen as another tightening of Washington’s sea blockade on Iran. Nearly eight weeks since the conflict began, there has been little indication of substantive peace negotiations resuming with tensions remaining high after Iran’s stranglehold on the Strait of Hormuz showed no signs of loosening.

Oil Prices

Oil prices rose for the fourth straight day on Thursday and extended gains into the Asian afternoon session, with international benchmark Brent trading around $103 per barrel (+1%) and US benchmark West Texas Intermediate up 1.8% at $94.60 amid little faith from investors in the Iran ceasefire. Shipping disruptions due to Iran’s seizure of two container ships passing through the Strait of Hormuz Wednesday added to the supply fears. Prices may rise further if tensions between Washington and Tehran flare up again or if Iran further disrupts shipping lanes in the Strait of Hormuz through which roughly 20% of the world’s oil supply passes daily. Rising oil is an Indian concern as well since the country imports most of its oil needs — now hovering around $100 a barrel, high crude is adding to India’s widening trade deficit, weighing on the rupee and compressing corporate margins.

Gold & Silver Prices Fall

Gold prices fell ₹120 on Thursday to ₹15,355 per gram — or ₹1,53,550 for 10 grams — succumbing to profit booking, signs of de-escalation in the Iran war and a mild pullback in oil prices from above $100 per barrel, while silver fell ₹50 to ₹2,600 per 10 grams across most of India. Gold prices in Chennai, Hyderabad and Kerala traded flat to marginally higher at ₹2,700 per 10 grams, continuing to trade at a premium to the rest of the country. The similar magnitude of declines in all gold and silver prices points to macro-driven profit booking across the board rather than localised selling.

Asian Markets Decline

Asian markets traded mostly lower at noon on Thursday as Iran-US tensions escalated yet again and oil remained stubbornly above $100 per barrel. Japan’s Nikkei 225 fell 0.69% to 59,174.88, Hong Kong’s Hang Seng lost 0.86% to 25,938.29, Thailand’s SET declined 1.43% to 1,458.61 to lead decliners, South Korea’s KSE 100 shed 0.91% to 171,579.31, Australia’s S&P ASX All Ordinaries dropped 0.55% to 9,024.20 and Shanghai’s SE Composite eased 0.37% to 4,091.19. The lone gainer was Malaysia’s FTSE Bursa KLCI, up 0.18% at 1,718.45.

Early Trade: Sensex Opens Down 680 pts, Nifty Down 173 pts

Indian benchmarks opened sharply lower on Thursday morning as the Sensex fell 679.77 points or 0.87% to 77,836.72 and the Nifty lost 172.90 points or 0.71% to 24,205.20 at 9: 37 am — failing to recover from Wednesday’s 750-point freefall in the opening minute of trade. Investors reacted negatively to Iran seizing two ships in the Strait of Hormuz Wednesday, US warships intercepting Iranian tankers in Asian waters near India, Malaysia and Sri Lanka overnight, and oil continuing to trade above $100 per barrel.

Sources:

• bseindia.com
• Nseindia.com