Sensex, Nifty see biggest single-day fall in 2 months as Bears rule the roost on D-Street

Nilesh Shah of Kotak AMC, said “Now, the market has to take little bit of respite and even correct a little bit. This will be driven by variety of factors”.

Firstly, the recently concluded quarterly earnings for June quarter is marginally below expectation driven mainly by some large stocks and overall breadth of the earnings has been positive. So clearly market has discounted breadth of the earning, but it probably has to discount some disappointments in larger names driven in automobile or in oil marketing companies.

Secondly, globally, the scenario does not look that good. There is a meeting at Jackson Hole where US Fed and other central bankers may try to be hawkish that will be on the mind of the market. “So we are at a stage where there is need for consolidation and the next move of the market will be dependent upon whether global uncertainty starts receding or starts increasing,” Shah highlighted.

The Indian rupee slipped to a four-week low against the dollar on Monday as the euro and the Chinese yuan extended losses.

The rupee dropped to 79.9125 per US dollar, lowest level since July 27, compared with 79.7750 in the previous session.

There is jitteriness over global growth as most central banks keep raising rates, while a modest easing by China served only to highlight troubles in its property market.

MSCI’s broadest gauge Asia Pacific ex-Japan was down 1 percent whereas key European indices were also trading in the red.

Meanwhile, S&P futures were down 1.3 percent hinting at a lower start for US equities.