Indian markets drop amid crude surge and RBI policy caution
The Indian stock markets opened lower on Wednesday, reversing gains from the previous two days. The BSE Sensex dropped 460 points to 72,599.05, while the NSE Nifty fell 164.80 points to 22,610.85. This decline came amid rising crude oil prices and caution ahead of the Reserve Bank of India's monetary policy announcement.
Several major companies saw significant losses, including Titan, Asian Paints, Bharat Electronics, Maruti, Axis Bank, and Mahindra & Mahindra. In contrast, Bajaj Finance and Bharti Airtel recorded gains. Brent crude, the global oil benchmark, surged 1.01% to USD 101.6 per barrel.
Analysts noted that while domestic liquidity and expectations of strong Q2 earnings are supporting the market, the focus remains on the RBI's stance. V K Vijayakumar, Chief Investment Strategist at Geojit Investments, highlighted the importance of the RBI Governor's message. Meanwhile, Foreign Institutional Investors continued to sell equities, offloading Rs 2,961.30 crore on Tuesday.
Asian markets also showed declines, with South Korea's Kospi, Japan's Nikkei 225, and Hong Kong's Hang Seng index all trading lower. U.S. markets, however, ended higher on Tuesday. Ponmudi R, CEO of Enrich Money, emphasized geopolitical risks and the RBI's policy decision as key factors influencing the market.