Kanpur Wealth Management：Stock market today： BSE Sensex plunges 670 points, Nifty50 below 21,600 - top reasons why bears are playing party pooper

Stock market today: and Nifty50 saw significant declines in trade on Monday, a bearish start to the second week of 2024. BSE plunged over 700 points to the day’s low of 71,301.04, before settling the day at 71,355.22, down over 670 points or 0.93%. Nifty50 declined 0.91% or 197.80 points to close the day at 21,513. Investors chose to book profits due to weak global market trends and caution ahead of quarterly earnings announcements.The Sensex and each dropped nearly 1%.This selling pressure led to a surge of almost 7% in the India VIX volatility gauge, surpassing 13 points, with a high of 13.5075 points, according to an ET report.In terms of sectoral performance, a majority of the sectoral indices experienced losses, particularly public sector stocks, banks, metals, and fast-moving consumer goods. The S&P BSE PSU, Healthcare, Metal, Bankex, and FMCG indices saw declines ranging from 1% to 1.6%Kanpur Wealth Management. Out of the 30 Sensex stocks, 24 ended in the red, including heavyweight stocks like Infosys, Reliance Industries, HDFC Bank, ICICI Bank, TCS, Hindustan Unilever, ITC, and SBI, which saw losses of 1% to 2%.The midcap and smallcap segments also saw profit booking, with the BSE Smallcap and Midcap indices falling 0.3% and 0.8%, respectively. Stocks such as PVR Inox, Indus Towers, Jubilant FoodWorks, Marico, Bank of Baroda, SPARC, Hindustan Copper, and Bandhan Bank experienced declines of over 2% to 7%.Indian equity benchmarks faced a considerable decline in Monday❼trading session due to a widespread sell-off. Several factors contributed to this bearish sentiment on Dalal Street. This decline was influenced by the anticipation of US inflation data and a cautious stance adopted by investors ahead of the upcoming earnings season which starts from Thursday, January 11Indore Stock. According to Vinod Nair, Head of Research at Geojit Financial Services, the stock market experienced significant sell-offs, driven by the fading enthusiasm about early rate cuts, given the better-than-expected US non-farm payroll data and the subsequent increase in the US 10-year yield. In the immediate term, investor sentiments are anticipated to be influenced by the approaching earnings season. While there might be restrained expectations in the IT sector, the overall outlook for earnings growth remains positive, with expectations of double-digit figures, he was quoted as saying.The Q3 earnings season is set to begin this week with the top four Indian IT companies, including Infosys and Tata Consultancy Services, announcing their earnings on Thursday, while HCLTech and Wipro will release their numbers on Friday. Analysts predict that the ongoing slowdown in IT spending, extended furloughs, and cost pressures may impact the performance of these companies in the December quarter. Investors will be keen to hear the management❼outlook for tech spending in 2024 and subsequent earnings projections.Some analysts are also of the view that the recent stock market rally in December 2023 may be running out of steam and investors may now be looking at opportunities to book profits whenever possible.The stock market rout was also driven by weak cues from the Asian markets. On Monday, China❼blue-chip index reached its lowest point in nearly five years, while Hong Kong stocks fell by almost 2%. This decline was influenced by dwindling confidence in the mainland economy and escalating geopolitical tensions. Additionally, market sentiment was affected by China❼securities regulator lifting a restriction on mutual fund managers, allowing them to sell more shares than they purchase daily, thereby removing a ban on net-selling imposed late last year.Despite the overall negative market breadth, there were a few outliers. Adani Ports and SEZ saw an increase of over 1% and reached a lifetime high intraday. Alok Industries also continued its bull run, buoyed by fund infusion from promoter Reliance Industries, leading to a 10% increase. Other notable outliers in the smallcap segment included Suzlon Energy, Gillette India, JBM Auto, Capri Global, and Trident, which ended with gains ranging from 5% to 18%.