Sensex falls 700 points, Nifty below 23,000 as crude rises; financials drag

The Sensex was at 73,188.04 at 9:25 am, down 707.70 points or 0.96%. The index opened at 73,734.83. The Nifty 50 was at 22,914.45, down 226.05 points or 0.98%, after opening at 23,064.90.HDFC Bank leads gains; IT stocks like HCLTech fall sharply. Benchmark indices opened sharply lower on Monday as rising crude oil prices, continued foreign selling and weakness in financial stocks weighed on investor sentiment. The sell-off comes after the Sensex and Nifty recorded their seventh straight weekly decline last week.The Sensex was at 73,188.04 at 9:25 am, down 707.70 points or 0.96%. The index opened at 73,734.83. The Nifty 50 was at 22,914.45, down 226.05 points or 0.98%, after opening at 23,064.90.Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said, "Two apparently contradictory trends - in the economy and markets- deserve attention. The economy is resilient and corporate earnings are improving, but the market is steadily going down. This is a case of external headwinds overpowering domestic tailwinds. Brent crude at $106 and the US 10-year yield at 5.2% are strong headwinds that are weighing on markets."He added, "FPIs, after turning buyers in July and August have again turned sellers in September. This scenario will keep the market under pressure in the near-term."The Nifty has slipped below the psychologically important 23,000 mark in early trade, adding to concerns after the index's prolonged losing streak.The sell-off was broad-based, with all major broader market indices trading in the red.The Nifty 100 fell 0.96%, Nifty 200 declined 0.97% and Nifty 500 dropped 0.97%. The Nifty Midcap 50 was down 0.98%, while the Midcap 100 fell 1.01%. The Nifty Smallcap 100 declined 1.08%.India VIX, the market's volatility gauge, rose 10.73% to 13.47, signalling increased nervousness among investors.FINANCIAL STOCKS LEAD THE FALLFinancial stocks were among the biggest drags on the benchmark indices. Bajaj Finance fell 1.59%, Kotak Mahindra Bank declined 1.38%, HDFC Bank dropped 1.37%, Axis Bank fell 0.33% and ICICI Bank declined 0.93%.Bajaj Finserv was down 1.19%, while SBI fell 0.80%.The Nifty Financial Services 25/50 index fell 1.08%, while the Nifty Private Bank index declined 1.14%. The Nifty Financial Services Ex-Bank index was down 1.11% and the Nifty MidSmall Financial Services index fell 1.13%.ALL MAJOR SECTORS IN REDThe weakness was visible across sectors. The Nifty Metal index fell 1.33%, Realty declined 1.30%, PSU Bank dropped 1.26% and Auto fell 0.95%.FMCG declined 1.06%, Oil & Gas fell 0.82%, Chemicals dropped 0.94% and Consumer Durables declined 0.66%.IT was relatively less affected, with the Nifty IT index down 0.16%. Pharma fell 0.35%, while Healthcare declined 0.49%.Among Sensex stocks, TCS was the only major gainer in early trade, rising 0.27%. Bajaj Finance was the biggest loser, followed by Kotak Mahindra Bank, HDFC Bank, Hindustan Unilever, BEL and Bajaj Finserv.Crude oil prices added to the pressure. Brent crude was trading at $106.61 a barrel, up 2.20%, while WTI crude was at $93.75, up 1.45%.Oil prices rose after a lack of progress in US-Iran talks and uncertainty over the Strait of Hormuz. For India, higher crude prices are a concern as they can raise the import bill, add to inflationary pressure and affect corporate profitability.- Ends