Mon, 22 Nov Closing
Indian share markets witnessed negative trading activity throughout the day today and ended on a weak note.
Benchmark indices fell sharply as investor sentiments remained jittery amid weaker global cues and amid the risk of a market correction.
Market participants resorted to heavy selling on disappointment over IPO valuations, cancellation of Reliance-Saudi Aramco deal and persistent selling by foreign investors.
At the closing bell, the BSE Sensex stood lower by 1,170 points (down 2%).
Meanwhile, the NSE Nifty plunged 348 points (down 2%).
Bharti Airtel and JSW Steel were among the top gainers today.
Bajaj Finance and Bajaj Finserv, on the other hand, were among the top losers today.
The SGX Nifty was trading at 17,517, down by 253 points, at the time of writing.
On the sectoral front, realty, energy, consumer durables and automobile stocks were among the hardest hit.
Shares of Bharti Airtel and Sheela Foam hit their respective 52-week highs today.
US stock futures are trading on a positive note today with the Dow Futures trading up by 135 points.
The rupee is trading at 74.40 against the US$.
Gold prices for the latest contract on MCX are trading down by 0.1% at Rs 48,770 per 10 grams.
Here are 5 Factors Why Indian Stock Markets Crashed Today
Weak global cues: Asian share markets turned cautious as data on Chinese retail sales missed expectations, though industrial output stayed solid, while more evidence of global inflation pressures helped gold to a three-month peak.
Chinese retail sales rose 17.7% in April a year ago, short of forecasts for a jump of 24.8%, while industrial output matched expectations with a rise of 9.8%.
The Hang Seng ended down by 0.4%, while the Shanghai Composite ended up by 0.6%. The Nikkei ended up by 0.1% in today’s session.
Covid cases on the rise: Some countries in Europe are witnessing a fresh rise in Covid-19 cases.
Austria is believed to be reintroducing a lockdown to curb new infections, some other countries such as Germany, Slovakia, the Czech Republic and Belgium may introduce precautionary measures.
While the world is better equipped to deal with the pandemic, a sharp jump in cases across Europe could hurt the global economy and have an impact on most stock markets around the world.
Forex reserves decline: The country’s foreign exchange reserves declined US$763 m to US$640.1 bn in the week ended 12 November 2021, RBI data showed.
In the previous week, the reserves went down US$1.1 bn to US$640.9 bn. It touched a lifetime high of US$642.5 bn in the week ended 3 September 2021.
In the reporting week, the decline in the foreign exchange reserves was on account of a dip in foreign currency assets (FCA), a major component of the overall reserves, the Reserve Bank of India’s (RBI) weekly data released on Friday showed.
Fresh inflation concerns: Global market sentiments have weakened due to fear of rising inflation around the world. It is no secret that there has been a sharp jump in inflation around the world due to the Covid-19 pandemic.
Surging energy prices, demand and supply chain disruptions and many other factors have pushed up prices of essential and non-essential commodities across the globe.
Even in major economies like the US and UK, consumer prices rose at their fastest pace in October in almost 3 decades.
All of these signals have spooked stock markets around the globe and domestic investors are also concerned that it will have an impact on India’s economic recovery.
A higher than expected rise in inflation could also force the RBI to start increasing key rates sooner, a move that could have a massive impact on the stock markets.
Major stocks in red: There was a broad based sell-off in most of the stocks today. Index heavyweight stocks and recently listed IPOs, all fell. (Maruti Suzuki (3.1%), Paytm (13%), Reliance Industries (4.4%) and State Bank of India (3.5%).
We will keep you updated on how these factors develop in the coming days and what effect they have on Indian stock markets. Stay tuned!
Speaking of stock markets, Brijesh Bhatia talks about why he is bullish on metal stocks, in his latest video for Fast Profits Daily.
Tune in to the video below to find out more:
In news from the energy sector, Reliance Industries was among the top buzzing stocks today.
Shares of Reliance Industries tumbled over 4.5% after it shelved a proposed deal to sell a 20% stake in its oil refinery and petrochemical business to Saudi Aramco for US$ 15 bn.
In a statement, the company said,
- Due to evolving nature of Reliance’s business portfolio, Reliance and Saudi Aramco have mutually determined that it would be beneficial for both parties to re-evaluate the proposed investment in oil-to-chemical (O2C) business in light of the changed context.
It further added that it will continue to be Saudi Aramco’s ‘preferred partner’ for investments in India’s private sector.
Ambani had in company’s annual general meeting of shareholders in August 2019 announced talks to sell a 20% in the O2C business, which comprises its twin oil refineries at Jamnagar in Gujarat, petrochemical assets and 51% stake in fuel retailing joint venture with BP, to the world’s largest oil exporter.
At that time, he had announced the deal would close by March 2020. The deadline was missed and the company blamed pandemic controlling restrictions, imposed towards the end of March 2020, for hampering due diligence.
This year too, at the AGM, Ambani stated that the deal would close by the end of the year. At the same event, he also announced new energy forays, including a plan for developing one of the largest integrated renewable energy manufacturing facilities in the world.
Reliance Industries share price ended the day down by 4.4% on the BSE.
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Moving on to news from the telecom sector…
Bharti Airtel Revises Prepaid Mobile Tariffs
Telecom service provider Bharti Airtel today said it has decided to revise its prepaid tariffs with effect from 26 November 2021. The news sent Bharti Airtel stock 4% higher in early trade.
‘Bharti Airtel has always maintained that the mobile average revenue per user (ARPU) needs to be at Rs 200 and ultimately at Rs 300, so as to provide a reasonable return on capital that allows for a financially healthy business model’, the company said.
The telecom service provider also believes that this level of ARPU will enable the substantial investments required in networks and spectrum. Even more important, this will give Airtel the elbow room to roll out 5G in India.
The entry-level tariffed voice plan has been hiked by about 25%, while for unlimited voice bundles the increase in most cases is about 20%.
The sector has been waiting for a tariff increase and soon Vodafone Idea and Jio are expected to follow suit. The last hike was in December 2019.
Bharti Airtel share price ended the day up by 3.9% on the BSE.
Speaking of stocks, here’s a pattern that if you see, you must sell your position. After all, exits are more important than entries.
In the chart below, we can see the head and shoulder pattern – the stock goes up, makes a high, falls a little bit, goes up to a higher high, does not make a higher low, rallies again, fails to make a new high, and then starts to break down.
This usually happens in a situation where a stock or index has typically been in a bull trend for a while. Spotting this correctly can help you save money.
If you’re interested in trading and want to know how you can use this pattern, you can read about it in one of the editions of Profit Hunter here: It’s When You Sell that Counts
To know what’s moving the Indian stock markets today, check out the most recent share market updates here.
For information on how to pick stocks that have the potential to deliver big returns,
What else is happening in the markets today? Dig in…
Stock Market Updates
Nov 22, 2021 12:30 pm
The BSE Sensex fell over 1,100 points while NSE Nifty dipped below 17,450-mark.
Sensex Falls 400 Points as Energy Stocks Witness Selling; Reliance & Bajaj Finance Top Losers (Today’s Market)
Nov 22, 2021 10:30 am
Indian share markets trade lower with the BSE Sensex down by 337 points, while the Nifty is down 86 points.
Nov 22, 2021 SGX Nifty
Trends on SGX Nifty indicate a firm opening for Indian stock markets.
Government’s Revival Plan for MTNL, ITC’s Software Business Demerger, and Buzzing Stocks Today (Today’s Market)
Nov 22, 2021 Pre-Open
Top cues to track in today’s stock market session.