Indian equities experienced a significant decline on Thursday, marking the fourth consecutive day of losses, as markets were unsettled by stringent remarks from the Federal Reserve. Following a highly anticipated decision to reduce borrowing costs by 25 basis points, the U.S. Federal Reserve signaled caution regarding further rate cuts, citing persistent concerns about inflation.
In response to the Fed's steadfast stance, U.S. Treasury yields surged, and the dollar ascended to its highest level in over two years, indicating apprehensions about tighter monetary policies. Experts have expressed concern that President-elect Donald Trump's proposed policies—particularly tax reductions and broad import tariffs—could exacerbate price pressures, maintaining elevated interest rates for an extended period.
The S&P BSE Sensex closed the session with a drop of 964.15 points, or 1.20%, settling at 79,218.05, as part of a broader global market downturn. Similarly, the broader NSE Nifty index concluded at 23,951.70, a decrease of 247.15 points, or 1.02%, from its prior closing mark.
The market exhibited a negative breadth, with 2,311 stocks declining, compared to 1,684 stocks advancing on the BSE. The most affected were financial and commodity-related stocks, with companies such as Asian Paints, Grasim, Bajaj Finance, JSW Steel, and Bajaj FinServ each dropping over 2%. Conversely, healthcare stocks experienced defensive buying, with Apollo Hospitals Enterprise, Sun Pharma, Cipla, and Dr. Reddy's Laboratories posting gains of 1-4%.
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