Market Close: Sensex dips 462.8 points as Fed cuts rate

Despite a decent recovery in the last trading session, the benchmark indices failed to close in the green zone. The BSE Sensex dipped by 462.80 points or 1.23 per cent at 37,018.32 on Thursday on the back of negative global cues as the US Fed cut benchmark policy rate.

The Nifty50 closes at a new 5-month low at 10,980.00, down by 138.00 points or 1.24 per cent. Index heavyweights that pulled down the Nifty were Infy, HDFC twins, SBI and ICICI Bank, while the stocks that help and supported the recover were Reliance and Maruti. The most traded index Nifty Bank closed down by 508.75 points or 1.76 per cent at 28,367.25 with all components of the index trading in red. The stock that contributed most to the downfall were SBI, HDFC Bank, ICICI Bank contributing more than negative 100 points and Kotak Bank negative 58 points.

Accept Nifty Auto all sectorial indices closed in the red. Even as the major indices were bleeding, the auto stocks staged a superb comeback and gained despite disappointing sales figure for the month of July. Maruti, Tata Motors, Mothersumi, M&M and Eicher Motors contributed positively to the Nifty Auto index which closed at 6,856.10, with a marginal gain of 4.45 points or 0.06 per cent.

On Sensex, top loser were Vedanta down by more than 5 per cent, followed by Tata Motors, Bharati Airtel and SBI down by more than 4 per cent and Infy, Yes Bank were down by more than 3 per cent. Among the top gainers were Maruti, Power Grid and Reliance up more than 1 per cent, while Bajaj-Auto, Hero Moto and HUL were up less than 1 per cent.

The movers and shakers of the day includes Ujjivan up by 9.03 per cent, Ajanta Pharma up 8.92 per cent, Reliance Infra up by 7.52 per cent and Aegis Logistics up by 6.11 per cent and Trent up by 5.71 per cent. On the losing end were Care Rating down by 19.28 per cent, Coffee Day down by 9.98 per cent, Shopper Stop, Zydus and Inox Wind down by more than 7 per cent each.

Overnight, the US Federal Reserve cut its key benchmark rate by 25 basis points, which is the first reduction since 2008. The Fed Chief, Jerome Powell however ruled out and further cuts and said the cut was a “mid-cycle adjustment to policy” rather than “beginning of a lengthy cutting cycle”. The Fed cited global weakness, trade tensions and a desire to boost too-low inflation and lower borrowing costs as a reason for the cut.