Stock Market Updates: Sensex crashed by 800 points today, and Nifty too slips.
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Summary: The Indian benchmark indices were down for the sixth consecutive time.
The Indian stock market benchmark Sensex fell by more than 800 points in morning trade on Wednesday, February 12, amid the conflicting global cues continuing its losing run for the sixth consecutive session at the day's low.
The Nifty 50 fell more than 1%, below 22,800, while the 30-share index fell from its previous closing of 76,294 to 75,388.
Sectoral decreases ranged from 1% to 2.5% for the Nifty Bank, Auto, Metal, Pharma, Realty, Consumer Durables, and Oil & Gas indices.
The Nifty Midcap100 sank 2.3% while the Nifty Smallcap100 index fell 2.9% in the overall market. With a 20% drop from their peak, small and midcap stocks are on the verge of entering a bear market.
The US president declared Donald Trump on Monday that international reciprocal tariffs would be implemented in the next few days and raised import duties on steel and aluminum from 10% to 25%, eliminating loopholes for certain countries and products.
The current market selloff may be worsened by a mood of caution ahead of the upcoming Income Tax Bill. According to reports, the law, which Finance Minister Nirmala Sitharaman announced in her February 1 Budget speech, is probably going to be placed before the Lok Sabha on Thursday.
The new Bill could lead to increased tax rates on financial securities, which raises worries.
In his testimony before Congress on Tuesday, US Fed Chair Jerome Powell expressed a cautious approach to interest rates, which reduced expectations for more rate cuts by the US Federal Reserve this year. Powell stated that while inflation is still high and the labor market is still doing well, the central bank is not under any pressure to cut rates anytime soon.
Global equities rose on Wednesday, as US Treasury yields grew stronger. MSCI's largest index of Asia-Pacific companies outside of Japan was up 0.32 percent following a flat session on Wall Street.
While S&P 500 futures showed a 0.02 percent decline, Nasdaq futures saw a slight 0.08 percent increase. Treasury securities moved across the curve as bond rates increased, indicating market hesitancy as they await additional US inflation data.
Investors continue to focus on the anticipated meeting between US President Donald Trump and Indian Prime Minister Narendra Modi tomorrow. Markets are anticipating announcements regarding potential reciprocal penalties following Trump's recent hike in tariffs on steel and aluminum imports.
Investor mood is still affected by the uncertainties surrounding trade policies, particularly in light of Trump's executive orders that eliminated exemptions for important trading partners like Canada, Mexico, and Brazil.
