Summary of the Day's Market Performance

Market Overview

• Sensex: Fell 964.15 points (-1.20%) to close at 79,218.05.

• Nifty: Dropped 247.15 points (-1.02%) to end at 23,951.70.

• Sector Performance:

  • Pharma: Outperformed, up 1.2% as defensive bets increased.

  • IT and NBFCs: Led declines, down 1.3% and 1.2% respectively.

💸 Market Transactions:

• Foreign Institutional Investors (FII): ₹-4,224.92 crore (Net Sellers)

• Domestic Institutional Investors (DII): ₹3,943.24 crore (Net Buyers)

FIIs continue to sell aggressively amid global risk-off sentiment, while DIIs provide limited support.

1. Fed’s Hawkish Stance:

   • The Federal Reserve's decision to reduce interest rates by 0.25% to 4.5%, coupled with an upward revision of the 2025 forecast to 4.0%, has triggered a global sell-off.

   • The "higher-for-longer" policy reflects persistent inflation concerns, negatively impacting market sentiment worldwide.

2. Impact on Sectors:

   • Interest-sensitive sectors like real estate and NBFCs saw notable declines.

   • Defensive sectors such as pharma gained traction amid uncertainty.

3. USD Strength:

   • A stronger USD prompts capital outflows from emerging markets like India, pressuring the Indian Rupee and market indices.

4. IT Sector Declines:

   • Heavily reliant on exports, Indian IT firms faced selling pressure as the Fed's hawkish tone dampened global demand expectations.

• Why Does a Hawkish Fed Hurt Markets?

  • A hawkish Fed signals higher interest rates for longer, increasing the cost of capital, reducing corporate profitability, and discouraging investments in equities. It also strengthens the USD, leading to outflows from emerging markets like India.

Key Stock Movements and News

• Top Gainers:

  • Dr. Reddy’s, Sun Pharma, Cipla.

• Top Losers:

  • Asian Paints, Bajaj Finance, Bajaj Finserv.

1. Infosys:

   • Becomes the first Indian company to secure EU certification for cross-border data transfers.

2. IOL Chemicals:

   • Surged +9% after announcing plans to consider a stock split on December 27.

3. SpiceJet:

   • Gained on settling a $16 million dispute with Genesis.

4. LTIMindtree, Wipro:

   • Tumbled as the Fed’s hawkish stance dampened IT demand expectations.

5. IPO Buzz:

   • Yash Highvoltage: Listed at a 90% premium over the IPO price.

   • Inventurus Knowledge Solutions: Rallied 47% on debut despite weak market sentiment.

6. Swiggy:

   • JP Morgan initiates coverage on Swiggy. It sees the company emerging as "an underappreciated winner" and sees a +27% upside from current levels.

• Infosys: EU certification may boost sentiment amid global IT weakness.

• IOL Chemicals: Watch for developments on the stock split proposal.

• Dr. Reddy’s: Upgraded to Buy by Nomura with a target of ₹1500, signaling growth potential.

• Swiggy: Sees a +27% upside from current levels.

The Indian market extended losses as global risk-off sentiment, driven by the Fed’s hawkish stance, weighed heavily on equities. Defensive sectors like pharma provided some relief, but the broader market remained under pressure. FIIs continue to sell aggressively, while DIIs struggle to counteract the impact. Investors are advised to stay cautious, focusing on defensives and stock-specific opportunities amid heightened volatility.

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