Sept 20 (The Street Press) – Indian shares had a tough day on Wednesday, dropping by 1%. This marked their roughest day in two months. The main stocks behind this decline were Reliance Industries and HDFC Bank. Additionally, HDFC Bank’s warning about its asset quality ratios had a negative impact on other financial companies as well.
The Nifty 50 ended the day 1.2% lower at 19,901.4 points, and the S&P BSE Sensex closed down 1.2% at 66,800.84 points. These benchmarks have faced declines for two consecutive sessions, following their recent record-breaking highs just last week.
HDFC Bank, which holds the most weight on the Nifty, experienced a significant 4% decline, marking its toughest day since early May. This drop came after the bank disclosed that its merger with HDFC Ltd would negatively impact crucial financial metrics, including margins and bad loan ratios.
In the broader financial sector, stocks declined by 1.5%, with bank stocks specifically falling by 1.3%. Private bank shares also witnessed a 1.2% decrease.Reliance, the diversified conglomerate and the second-heaviest stock on the Nifty, saw a 2.2% decline, possibly due to multiple block deals, as per LSEG data.
IT stocks, known for their sensitivity to U.S. interest rates, experienced a 0.54% drop ahead of the Federal Reserve’s policy meeting scheduled for later in the day. The expectation is that the Fed will maintain interest rates at their current levels but with a potentially more hawkish stance.
In the stock market, mid-cap companies with a focus on local markets saw a slight dip of 0.3%, while small-cap companies experienced a more significant decline of 0.9%.
Interestingly, the public sector enterprises index was the lone gainer among the 13 major sectors, rising by 0.17%. This increase was primarily driven by coal and power stocks, which continued to surge due to expectations of unusually high electricity consumption in October and November.
A noteworthy highlight was RR Kabel (RRKA.NS), a manufacturer of wires and cables, which had an impressive debut in the market, closing nearly 16% higher on its first day of trading.
