Realty, Metal Stocks Lead Market Rout as Oil Spike, Global Risks Trigger Broad Selloff

Mumbai, June 8: Indian equities witnessed broad-based selling on Monday, with rate-sensitive and cyclical sectors bearing the brunt of investor concerns over rising crude oil prices, escalating Middle East tensions and fears that the U.S. Federal Reserve could keep interest rates elevated for longer. 

The Nifty 50 fell 1.04% to close at 23,123, while the Sensex shed 719 points. All major sectoral indices ended in the red as investors rushed to cut exposure to risk assets amid a deteriorating global backdrop. 

Realty, Metal Indices Tumble Over 2% 

Real estate and metal stocks emerged as the worst-performing pockets of the market, with both the Nifty Realty and Nifty Metal indices falling more than 2%. 

In the realty space, stocks such as DLF, Godrej Properties, Prestige Estates Projects and Phoenix Mills came under pressure as investors worried that higher-for-longer global interest rates could dampen demand and investment sentiment. 

DLF share price fell 2.8% to Rs 561.30 while Godrej Properties share price declined 3% to Rs 1,654.60.  

Metal stocks were also hit by concerns over slowing global growth and weaker risk appetite. Hindalco Industries was among the top losers on the Nifty, while Tata Steel, JSW Steel and Vedanta also witnessed significant selling pressure. Hindalco Industries share price fell 2.8% to Rs 1,062.40. 

IT Extends Losing Streak 

Nifty IT kept going on its losing streak as a global tech selloff ruined sentiment. Source: NSE 

Technology stocks remained under pressure for a fourth straight session as global investors continued to reassess valuations in the sector following a sharp correction in U.S. technology shares. 

The Nifty IT index declined more than 1%, extending its recent slide. Wipro emerged as the biggest loser on the benchmark index, while Infosys, TCS, HCLTech and LTIMindtree also ended lower. To be sure, TCS declined despite news of a new multiyear transformation and managed services agreement with Canada Life, a leading global life and pensions insurer. 

The IT weakness followed last week’s steep decline in the Nasdaq, where stronger-than-expected U.S. economic data reduced expectations of near-term Federal Reserve rate cuts. Investors also continued to evaluate the long-term impact of artificial intelligence on traditional IT services companies. 

Autos, Consumer Stocks Lose Momentum 

Nifty Auto revved down as retail sales data depressed investors. Source: NSE 

Automobile stocks also came under selling pressure, with the Nifty Auto index dropping about 1.8% after the Federation of Automobile Dealers Associations (FADA) reported a month-on-month decline in vehicle retail sales for May. 

Mahindra & Mahindra, Tata Motors, Hero MotoCorp and Bajaj Auto were among the major drags as rising crude oil prices added to concerns. Ashok Leyland fell nearly 3%.  

Consumer durables and FMCG counters also traded lower as investors shifted away from domestic consumption plays amid the broader risk-off mood. 

Energy, Infrastructure, Financials Slide 

Energy, infrastructure and oil & gas stocks ended firmly in the red despite the rise in crude oil prices. 

Reliance Industries, BPCL and Indian Oil Corporation witnessed negative moves as investors focused on the broader implications of higher oil prices. ONGC meanwhile flatlined. 

Nifty Financial Services fell on fears of a hawkish US Fed looming above credit markets. Source: NSE  

Nifty Financial Services index fell 1% amid fears of US monetary tightening as HDFC Bank and ICICI Bank declined among private lenders. State Bank of India, however, edged up. 

Defensives Offer Some Shelter 

A handful of defensive names helped limit the market’s losses. 

Max Healthcare, Power Grid Corporation, Bharat Electronics, Tech Mahindra and Nestlé India were among the few Nifty gainers, benefiting from selective buying as investors sought relatively stable earnings plays. 

Despite stronger-than-expected March-quarter GDP growth data released after market hours on Friday, domestic markets remained firmly focused on global developments. With crude oil prices surging and geopolitical risks escalating, investors largely ignored the positive macroeconomic backdrop and opted for caution. 

The near-term direction of sectoral performance is likely to depend on movements in crude oil prices, developments in the Middle East and evolving expectations around U.S. monetary policy. 

Source

• NSE