BAGHDALURU: Thursday saw a decline in Indian shares as the surge in IT and banking companies following the US Federal Reserve’s rate hold ended.
Indian shares drop: The S&P BSE Sensex ended the day 0.22% lower at 64,832.20, while the NSE Nifty 50 index dropped 0.25% to conclude at 19,395.30.
Since the Fed kept interest rates unchanged on November 1st, the Nifty has increased by almost 2%, despite the Fed’s less aggressive than anticipated monetary policy stance.
The founder of Fintrekk Capital, Amit Kumar Gupta, stated that “the markets look a little over extended after the recent rally.”
The IT and financials had also gained roughly 2% since the Fed’s halt. On the day, they decreased by 0.65% and 0.10%, respectively.
Gupta says that since investors are adjusting their portfolios, a major correction in the Nifty or large-cap equities is unlikely.
In order to reduce volatility following the recent strong increase in small- and mid-cap stocks, investors are probably going to switch their portfolio allocation from small- to large-cap stocks.
The 2023 gains in the small- and mid-cap indexes have surged 37% and 29%, respectively, considerably surpassing the 7% gain in the Nifty.
On the day, mid-cap stocks gained 0.22% and small-cap stocks decreased 0.24%.
Among the winners were equities related to real estate, which surged by 1.23% to reach a new high.
A 4.35% increase in Mahindra & Mahindra ahead of its results on Friday drove the auto index’s 0.83% gain.
Along with Apollo Hospitals, which closed 3.65% higher after reporting a greater quarterly profit, it was one of the top Nifty gainers.
Among the biggest Nifty losers were Tech Mahindra, Hindustan Unilever, and Tata Consumer Products.
