Weekly Market update, Dec 09, 2022

The Indian benchmark indices fell and snapped their two-week gaining streak after the Reserve Bank of India led Monetary Policy Committee (MPC) raised key policy repo rate by 35 bps. The MPC decided to maintain its focus on withdrawal of accommodation in its monetary policy. It also downgraded the growth projections of the Indian economy for the current fiscal to 6.8% from the earlier projection of 7% in its monetary policy review. Market fell further following heavy selling in IT, tech and energy stocks. The S&P BSE Sensex closed lower by 1.09% at 62,181, while the NSE Nifty 50 ended 1.07% lower at 18,496. The broader market indices S&P BSE MidCap and S&P BSE SmallCap were down 0.86% and 1.18%, respectively. On the sectoral front, S&P BSE IT fell the most by 5.33% followed S&P BSE Teck which fell 4.56%. IT stocks fell on concerns of a potential slowdown in business due to global recession fears. S&P BSE FMCG rose the most by 1.97%.

Analysts expect that the volatility in the market is expected to remain as we await the domestic and US inflation numbers, and the Fed’s interest rate decision next week. The FOMC is projected to raise interest rates by half a percentage in its final meeting of the year, which will take place on 13–14 December 2022.

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