5 reasons behind the fall of the Sensex and Nifty

Indian equities witnessed another fall in the market barometers on the 15th March 2021. The Sensex fell by 993 points and the Nifty slipped below 14,750.

At close, the Sensex was 397 points, or 0.78 per cent, down at 50,395.08, meanwhile Nifty was at 14,929.50, down 101 points, or 0.67 per cent. Let’s explore the reasons behind the fall.

5 reasons for the fall in Sensex and Nifty:

1. Rising bond yields – Rising bond yields seem to have eroded investor interest in riskier equities. Bond market cues often reflect in equity markets. After a bull run, the stock market has corrected in recent days, with both the Sensex and the Nifty falling from record highs.

2. Weak global cues – Most Asian markets traded lower after Wall Street’s main indexes tumbled, following a steep rise in benchmark US Treasury yields.

3. Caution ahead of GDP data – The NSO (National Statistical Office) will release gross domestic product (GDP) growth estimates for the third quarter (October-December) 2020-21 later today.

4. Geopolitical tensions – Rising geopolitical tension also hit market sentiment globally. As reported by Reuters, “US President Joe Biden on Thursday directed US military airstrikes in eastern Syria against facilities belonging to what the Pentagon said were Iran-backed militia, in a calibrated response to recent rocket attacks against US targets in Iraq.”

5. COVID-19 remains a concern – With vaccination picking pace, Covid-19 is expected to come under control in the coming months but the pandemic remains an overhang on the market.