look news india
New Delhi, September 6 (HS). The domestic stock market fell prey to a big decline today. Sensex closed with a weakness of 1.24 percent and Nifty closed with a weakness of 1.17 percent. This is the third consecutive day when the domestic stock market has closed with a decline. It is believed that along with global pressure, the situation of pressure in the market was also created due to the sluggish sentiments of the global market. Along with this, profit booking is also being considered a major reason for the decline in the market.
According to Prashant Dhami, Vice President of Dhami Securities, tension prevails in the US due to the employment data. The employment data is also expected to affect the decision to be taken by the US Federal Reserve regarding interest rates. This is the reason why US investors are trading in a cautious posture before the employment data comes out. Because of this, investors are trying to avoid taking big positions in Wall Street as well as other stock markets around the world. Dhami believes that it is almost certain that the US Federal Reserve will cut interest rates, but it has not yet been estimated how much the interest rates will be cut. Investors fear that the employment data will also affect the reduction in interest rates.
Similarly, Vijay Kumar, Chief Investment Advisor of Geojit Financial Services, believes that the slowdown in the global market also had a great impact on the domestic stock market trading today. All three major indices of Wall Street closed under pressure in the last trading session. Similarly, there was selling pressure in the European market as well. In the Asian markets too, Japan's Nikkei Index, China's Shanghai Composite Index and South Korea's Kospi Index closed with a big decline today. This decline in many stock exchanges of the world also created a situation of pressure in the Indian stock market today.
Market experts say that the domestic stock market itself is going through a phase of consolidation. Before this, till Tuesday, Nifty was able to trade strongly for 14 consecutive days. Similarly, Sensex also kept rising for 8 consecutive days. In such a situation, investors are now engaged in taking out their money by booking profits. The pressure of profit booking also played an effective role in destroying the stock market.
Sarvjeet Gupta, CEO of GK Financial Services, believes that the domestic stock market, especially the midcap and smallcap segments, currently have high valuations. The shares of many companies are trading at a much higher rate than the actual price. If we talk about the old record of the stock market, then midcap and smallcap usually undergo correction in the fourth or fifth year. Before this, there was a correction in small caps about 5 years ago. In such a situation, it can be assumed that once again, after a gap of 5 years, small and medium shares are facing correction.