• Mumbai's stock market opened in the red on October 18, 2024, due to escalating geopolitical tensions and weak global cues.
• Key sectors like IT, auto, pharma, and PSU banks experienced significant sell-offs, contributing to the bearish market sentiment.
• Despite the overall negative market sentiment, stocks like Wipro, Axis Bank, and TCS managed to make gains.
• The Indian market's underperformance was attributed to a 6% correction in Nifty from its peak, delivering a return of only 13.83% year-to-date.

The financial hub of India, Mumbai, experienced a somber start to the trading day on October 18, 2024, as the Indian stock market opened in the red.

The downward trend was a direct result of the escalating geopolitical tensions between Iran and Israel, coupled with weak global cues. The market's negative opening was a reflection of the global economic climate, which was marred by uncertainty and apprehension.

In the early hours of trading, a significant sell-off was observed in several key sectors. These included Information Technology (IT), auto, pharma, and Public Sector Undertaking (PSU) bank sectors. The sell-off in these sectors, which are considered the backbone of the Indian economy, further contributed to the bearish sentiment in the market.

The benchmark indices, the Sensex and the Nifty, also mirrored the overall market sentiment. The Sensex was trading at 80,752.18, having slipped 254.43 points or 0.31%, while the Nifty opened at 24,675.30, falling 74.55 points or 0.3%.

Sectoral Indices Reflect Market Sentiment

The downward trend was not limited to these indices alone. On the National Stock Exchange (NSE), out of the total stocks traded, 283 were in the green, while a staggering 1,941 were in the red. Similarly, on the Bombay Stock Exchange (BSE), 588 stocks were trading in green, while 2,166 stocks were trading in red.

The banking sector, represented by the Nifty Bank, was also affected by the bearish market sentiment. The Nifty Bank was trading at 51,055.00, having fallen 233.80 points or 0.46%. The mid-cap and small-cap sectors, often considered the barometer of the domestic economy, were not immune to the market downturn either.

The Nifty Midcap 100 index was trading at 57,636.95 level, having fallen 829 points or 1.42%, while the Nifty Smallcap 100 index was at 18,673.75, having fallen 392.20 points or 2.06%.

Despite the overall negative market sentiment, there were a few stocks that managed to swim against the tide. Wipro, Axis Bank, and TCS emerged as the top gainers in the Nifty pack. On the other hand, Bajaj Auto, Titan Company, Infosys, Maruti Suzuki, and Shri Ram Finance were the top losers, reflecting the bearish sentiment that prevailed in the market.

Global Markets Outperform Indian Market

The Indian stock market's performance was in stark contrast to some of the Asian markets. Except for Seoul, the stock markets of Bangkok, Shanghai, Hong Kong, Jakarta, and Tokyo were trading in the green. The US stock market also closed in the green on the last trading day, further highlighting the underperformance of the Indian market.

Market experts have attributed this underperformance to a 6% correction in Nifty from its peak. This correction has resulted in India delivering a return of only 13.83% year-to-date (YTD), significantly lower than the 23.16% return in the S&P 500 YTD.

This underperformance of the Indian market is reminiscent of similar historical events where geopolitical tensions and weak global cues have led to a market downturn.

The Hang Seng index, with a 23.16% return YTD, has emerged as the best-performing market in recent weeks. This performance has been aided by massive buying by Foreign Institutional Investors (FIIs), a trend that has been observed in the past during periods of market volatility.

The performance of the Indian stock market on Friday, October 18, 2024, was a reflection of the prevailing geopolitical tensions and weak global cues did contribute to it. The market's downturn was broad-based, with sell-offs observed across key sectors and indices.