08 September,2026 12:00 PM IST | Mumbai | mid-day online correspondent
Representational Image. File pic.
The domestic equity benchmark indices extended their losses in the early trade on Tuesday as the elevated crude oil prices amid renewed tensions between US and Iran made the investors risk averse. The heightened activity in the primary market with nearly a dozen mainboard initial public offering (IPO) this week, that is estimated to garner over Rs 7,000 crore, has also contributed to the decline, according to analysts.
During the initial trade, 30-share BSE Sensex slumped 346.53 points or 0.46 per cent at 75,786.28, while the 50-share NSE Nifty dropped 95.85 points or 0.40 per cent to 23,683.30.
According to V K Vijayakumar, Chief Investment Strategist, Geojit Investments the market is now in the fifth week of a slow but steady downtrend led by elevated crude prices, selling in IT stocks, concerns on a possible Federal Reserve rate hike this month and a booming IPO market which has redirected investment flows to the primary market.
"Since the macro construct which contributed to this downtrend persists, it is possible that the downtrend may continue in the near-term. But this trend is opening up opportunities for investors in large-caps which continue to remain weak despite improving fundamentals," he said.
"A major factor contributing to the weakness of the large-caps despite their attractive valuations is that bulk of the steady monthly SIP inflows are going to the mid-and small-cap segments despite their elevated valuations. A reversion to mean is overdue in the mid-and small-cap segments. This can facilitate a rally in fundamentally sound large-caps. The timing of this transition is hard to predict. But this is likely by this month-end when the mega IPOs of NSE and Jio are completed and refunds from the IPOs come back to investors. Instead of trying to time the market, investors can think about changing the weightage of portfolios towards large-caps where the risk-reward is favourable," he added.
Among the 30 Sensex constituents, only four of its constituents traded higher in the early deals. Bharat Electronics, Adani Ports, Tata Steel, and Eternal were the gainers in the initial deals. Mahindra & Mahindra, Sun Pharma, Trent, Axis bank, Tech Mahindra were the laggards in early deals.
On Monday, the Sensex slipped 382.62 points, or 0.50 per cent, to settle at 76,132.81, while the Nifty shed 118.55 points, or 0.50 per cent, to end at 23,779.15.
"Asian markets are largely holding firm this morning, with the Nikkei 225 up 0.4 per cent and the Kospi surging more than 2.7 per cent, while the Hang Seng is trading 0.9 per cent lower. The key variable for Indian equities remains crude oil, with Brent hovering around USD 97 a barrel near six-week highs, keeping import-cost and inflationary concerns firmly in focus," Rajesh Palviya, Head of Research, Axis Direct.
"Positive Asian cues may provide some early support, but any further spike in crude prices could limit the scope for a meaningful recovery," he added.
According to news agency PTI, Brent crude, the global oil benchmark, was trading higher by 0.63 per cent at USD 97.61 per barrel in futures trade, while Foreign institutional investors (FIIs) purchased equities worth Rs 280.13 crore on a net basis on Monday.
In Asian markets, South Korea's Kospi, Japan's Nikkei 225 index, Shanghai's SSE Composite index traded higher, while Hong Kong's Hang Seng index quoted lower.
(With inputs from PTI)
