Indian Stock Markets Struggle in Early Hours of 2024
Indian stock markets opened on a weak note on the last trading day of 2024, with major indices tumbling as investor sentiment remained dampened. By 10:18 AM, the S&P BSE Sensex was down by 543.59 points, or 0.69%, hovering around 77,704.54, while the Nifty50 index saw a decline of 118.70 points, or 0.5%, settling at 23,526.20.
The decline was largely driven by heavy losses in IT stocks and realty counters. With such a significant drop in the morning session, analysts are bracing for a volatile end to the year.
Out of the 50 stocks listed on the Nifty50 index, a considerable 31 were in the red, while just 19 saw a marginal gain. This broad-based sell-off indicates widespread weakness across sectors, particularly the technology space.
IT Stocks Lead the Decline
The Information Technology (IT) sector bore the brunt of today’s market slump. The BSE IT index was trading at 42,852.71, reflecting a sharp 2.05% decline. Key stocks like Infosys, TCS, and HCL Technologies were major losers in the early hours of trading.
- Infosys and TCS were both down over 1%, while HCL Tech saw a fall of nearly 1%.
- Wipro and Tech Mahindra, too, posted similar losses, highlighting a sharp sell-off in the tech-heavy Nifty IT index.
Many analysts are attributing the fall to broader global headwinds that have weighed down the sector, with concerns over slowing demand and rising costs.
Adani Wilmar Takes a Hard Hit
One of the day’s biggest headlines came from Adani Wilmar, which experienced a massive drop of nearly 8%, hitting a low of ₹303.70 per share on the Bombay Stock Exchange. This sharp decline followed the announcement that the Adani Group would be exiting its FMCG joint venture by selling its entire stake in the company to its Singaporean partner, Wilmar International.
The deal, valued at over $2 billion, is part of a broader strategy by the Adani Group to streamline its business and divest from non-core assets. In total, Adani Enterprises Ltd plans to sell a 31.06% stake to Wilmar International, while the remaining 13% will be sold in the open market to meet public shareholding requirements.
The market reacted swiftly, and the stock price of Adani Wilmar began its downward spiral after the announcement. The sell-off has raised questions about the future of the company and its prospects in the highly competitive FMCG market.
Sector-Wise Performance
Despite the losses, there were a few bright spots in the market. Some of the top gainers on the Nifty50 included Kotak Mahindra Bank, Bharat Electronics (BEL), ONGC, SBI, and Bajaj Auto. These stocks showed resilience in an otherwise grim market.
However, overall, the market sentiment remained pessimistic. The top five losers included large-cap stocks such as Infosys, TCS, Tech Mahindra, HCL Technologies, and Wipro. The steep declines in these names played a significant role in dragging down the broader market indices.
Sector Overview
- Top Gainers: Kotak Mahindra Bank, BEL, ONGC, SBI, Bajaj Auto
- Top Losers: Infosys, TCS, Tech Mahindra, HCL Technologies, Wipro
The market breadth was heavily skewed towards declines, with more than 60% of Nifty50 components losing ground. This indicates a lack of investor confidence, as sectors like IT and real estate continue to struggle.
Looking Ahead: What’s Next for the Market?
With the year-end approaching, traders and investors are evaluating their strategies. While the last few days of December have been rocky, the outlook for 2025 remains uncertain.
The broader macroeconomic conditions, including rising inflation and potential policy changes, are likely to continue influencing market performance. Additionally, the global economic environment, particularly in the US and China, could impact investor sentiment in the coming months.
As the market closes for the year, the focus will shift to upcoming earnings reports and the budget for 2025. These factors could help define the direction of the market in the first quarter of the new year.
