Mumbai, Aug 27: Indian equity markets closed lower on Thursday as continued geopolitical uncertainty and the lack of progress in negotiations surrounding the Strait of Hormuz weighed on investor sentiment.
The Sensex fell 539 points, or 0.70 per cent, to close at 76,933, while the Nifty declined 116 points, or 0.48 per cent, to settle at 24,090. The Nifty Bank index also slipped 273 points, or 0.47 per cent, to end at 57,509.
Market participants remained cautious amid concerns over developments in the Middle East and their potential impact on energy prices and global markets. Analysts said expiry-related volatility and the absence of a diplomatic breakthrough could keep Indian equities range-bound in the near term.
However, the recent moderation in crude oil prices and long-term bond yields has provided some support to the inflation outlook. Strong domestic demand and resilient corporate earnings are also helping limit the impact of global uncertainties on Indian equities.
The broader market followed the benchmark indices lower. The Nifty Midcap 100 declined 0.10 per cent, while the Nifty Smallcap 100 fell 0.13 per cent. The Nifty Next 50 slipped 0.21 per cent.
Among sectoral indices, most ended in negative territory. Nifty Cement, Media, Metals and PSU Bank were among the major laggards, while private banks, pharmaceuticals and consumer durables recorded marginal gains.
Technical indicators pointed to increased selling pressure, with analysts noting that the benchmark index had slipped below its rising channel on the daily timeframe and moved below the 50-day exponential moving average.
The Indian rupee also remained weak against the US dollar, adding to the cautious mood in domestic markets.
Despite the day’s decline, analysts said foreign institutional inflows and healthy earnings momentum could continue to provide support, particularly to segments of the mid-cap market that are benefiting from strong domestic demand.
Investors are also awaiting the upcoming Jackson Hole address by the US Federal Reserve chair. The speech is expected to provide clues on inflation, interest rates and the future course of monetary policy, developments that could influence global risk appetite and capital flows into emerging markets.
Overall, Indian equities remain sensitive to global geopolitical developments, crude oil prices and monetary policy signals, while strong domestic fundamentals continue to provide a degree of stability to the market.
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