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On the other hand, the fall in the rupee and the strengthening of the dollar index once again is also putting pressure on the stock market. The rupee is at a record low of Rs 84 against the dollar. The Indian rupee is one of the weakest currencies in Asia. In such a situation, this is also an important reason for the fall in the stock market.
Inflation data will be released in the next one week
Apart from this, selling by foreign investors is clearly visible in the month of September. The effect of which is clearly visible on the market. Inflation figures are going to come next week. The data of the month of August is not the same as was seen in the month of July. The biggest factor is food inflation which remains at a high level. Let us also discuss with you all the reasons for the fall in the stock market.
These are the major reasons for the fall in the stock market
Profit booking in stock market: The Indian stock market was in a bullish trend for 14 days before the sell-off began on Wednesday this week. The stock market appears to be overvalued at the moment. Due to which profit booking is being seen by investors in the market. There was heavy buying in the Indian stock market. Therefore, the current selling should be considered only as profit booking.
Rupee depreciates: On the other hand, the Indian rupee has declined against the dollar. Currently, the rupee is hovering around the level of 84 against the dollar, this is also a reason why the stock market is witnessing a decline. The rupee has declined by 0.13 percent in the last 15 days. Talking about the current year, the rupee has seen a decline of 1 percent.
Dollar index improves: On the other hand, the dollar index is seeing improvement. However, there has been a decrease of 2.12 percent in the last one month. At the same time, the dollar index has seen a decline of about 4 percent in a year. According to experts, the dollar is trying to rebound. This is the reason why the stock market is witnessing a decline. According to the information, the dollar index is currently trading at the level of 101.
Disinterest of foreign investors: On the other hand, the indifference of foreign investors is clearly visible in the last one week or the current month. According to reports, on Thursday, foreign investors withdrew their money from the Indian stock market. Just a day before, foreign investors had invested Rs. 688.69 crores and sales were made. However, in the current month, foreign investors have invested Rs 11,882 crore in the stock market.
US Fed Meeting: The main reason for the fall in the market is the uncertainty regarding the interest rate cut in the US Fed meeting to be held this month. If the US Fed announces a 25 bps rate cut, the market will not be happy with this decision. A fall of 50 basis points will breathe new life into the stock market.
US jobs data: US job opportunities fell to a three-and-a-half-year low in July, leading to a slowdown in the US labor market. All stock markets around the world, including India, are witnessing a decline.
Fear of inflation in America: Fears of a slowdown in the US labor market have rekindled US inflation fears, which may force the US Fed to reconsider its decision to cut rates. Even if they continue their dovish stance, the market fears that the US Fed rate cut may not exceed 25 bps.
The stock market fell sharply
The stock market has been witnessing a huge decline since Friday morning. During the trading session, the Sensex fell by 1055.88 points. According to BSE data, the stock opened with a slight decline at 82,171.08 points in the morning and touched a low of 81,145.28 points intraday. While in the last three days, the Sensex has seen a decline of more than 1400 points.
At the same time, Nifty is also witnessing a decline. During trading, Nifty has seen a decline of more than 300 points. Currently, Nifty is trading at 24,858 points, down 288 points.
