Rising volatility keeps markets on the edge – Market News
Broader market came under selling pressure on Tuesday as rising volatility and high valuations provided investors a recipe for profit booking. The smallcap and midcap index on BSE corrected as much as 2% each intraday, while the volatility index India VIX rose for the ninth consecutive session to 17.01.
This was the third consecutive session of decline for both the broader market indices after they hit their lifetime high levels in intraday trading on May 3.
On Tuesday, the BSE Smallcap
Deepak Jasani, head of retail research at HDFC
The benchmark indices too have followed a similar trend, though selling has been steeper in broader markets. The selling on Tuesday was broad-based with 2,794 stocks ending lower on BSE and 1,034 stocks rising.
Market participants said the rising volatility could have propelled some investors to close leveraged positions. Apart from this, with the last leg of earnings season, there could’ve been correction in some stocks whose earnings performance failed to justify the rich valuations, analysts said.
There have been concerns over excessive valuations of stocks in midcap and smallcap space since March. Despite this, the broader market has shown resilience.
The ongoing volatility has been primarily induced due to nervousness amid the ongoing General Elections.
Text for separate box on VIX
India
The index rose 3% to 17.05 levels on Tuesday. With this, it has now risen a whopping 67% in nine sessions.
Market participants expect the metric to rise even further towards 22-25 levels in the run up to the counting of votes on Jun 4.
If you are keen to know more about Nifty 50 and BSE Sensex levels and seek expert advice on what’s driving the gains and how to build your portfolio, track the latest stock market stats, share market news and top brokerage bets on Financial Express.
Download the Financial Express App for the fastest and most reliable business news alerts, key investment strategies and latest movers and shakers from across financial market.
First published on: 08-05-2024 at 02:10 IST