After opening the day in red, share markets in India witnessed negative trading activity throughout the day and ended the day deep in the red. All sectoral indices traded in red, with stocks in the IT sector and stocks in the energy sector, leading the losses.
At the closing bell, the BSE Sensex stood lower by 806 points (down 2.2%) and the NSE Nifty closed down by 259 points (down 2.4%). The BSE Mid Cap index ended the day down 1.9%, while the BSE Small Cap index ended the day down 2.1%.
The rupee was trading at Rs 73.66 against the US$ in the afternoon session. Oil prices were trading at US$ 86.16 at the time of writing.
Asian stock markets finished in red. As of the most recent closing prices, the Hang Seng was down by 1.3% and the Shanghai Composite was down by 1.2%. The Nikkei 225 was up by 0.3%. Meanwhile, European markets too were trading on a negative note. The FTSE 100 was down by 1%. The DAX, was down by 0.3% while the CAC 40 was down by 1.1%
Corrections like these could be the right time to go hunting for quality companies available at cheap valuations.
Benefit from the Deep Correction: Buy Some of These Stocks
Talking about finding quality companies in this market correction, you should note that foreign investors continue to sell Indian stocks and bonds.
Foreign investors have been dumping Indian financial assets - both equity and debt - for a while now.
In the month of September, foreign investors have been net sellers of debt and equity to the tune of Rs 81.6 billion and 41.6 billion, respectively.
More than 600 companies have fallen more than 50% this year. That's a massive correction.
While many of these companies never deserved the kind of valuations they got in the first place, some have been victims of an over-reaction in the market.
Corrections like these can prop up new opportunities to buy quality stocks.
Moving on to news from stocks in the banking sector. ICICI Bank share price was in focus today after it was reported that Chanda Kochhar quit as the bank's CEO with immediate effect.
The development took place after the bank accepted the outgoing CEOs plea for early retirement.
Notably, Kochhar was on an absence of leave from office, pending an investigation into allegations of her having favored family members in lieu of providing loans to Videocon Group.
In June, a panel was set up under retired Supreme Court judge Justice Srikrishna to probe allegations against Chanda Kochhar.
Meanwhile, the bank has appointed Sandeep Bakshi as managing director and CEO of the bank for a period of five years, subject to regulatory approvals.
Bakhshi had taken the helm on an interim basis last June, after Kochhar had been sent on leave pending an inquiry. He is a former head of the life insurance arm at ICICI Bank.
Post the developments, ICICI Bank share price ended the day up by 4.1%.
Moving on to news from stocks in the energy sector. Oil marketing companies (OMCs) ended the day deep in red after the finance minister announced a Rs 1.5 drop in fuel prices, along with another Re 1 drop by oil marketing companies.
The announcement led to OMCs like HPCL, ONGC, IOC hitting their 52-week lows.
The announcement comes after fuel prices have been consistently hitting record highs since mid-August. As of October 4, petrol prices jumped 14 paise to Rs 91.34 per liter in Mumbai.
The finance minister said that the duty cut could cost the exchequer over Rs 105 billion. He added that fuel prices were sky high due to international factors. Primarily the rising cost of Brent crude oil prices, which touched $86 per barrel, the highest in four years.
HPCL share price ended the day down by 12.2%, while IOC share price and ONGC share price were down by 10.6% and 3.7% respectively.
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