After opening the day on a negative note, Indian share markets continued the downtrend as the session progressed and ended the day weak.

Benchmark equity indices, BSE Sensex and NSE Nifty50, ended in negative territory for the second consecutive session on Thursday.

October sees the Nifty plummet nearly 6%, its worst monthly drop since the 23% crash in March 2020 due to Covid fears, while BSE's total market capitalization declines by Rs 29 lakh crore this month.

Further, This Diwali marks the worst pre-Diwali phase for investors in the past decade, with the Nifty posting negative returns for only the fourth time since 2014, averaging a decline of 0.84%, and its worst drop of 4.45% in 2015.

At the closing bell, the BSE Sensex stood lower by 553 points (down 0.7%).

Meanwhile, the NSE Nifty closed lower by 135 points (down 0.6%).

Cipla, L&t, and ONGC were among the top gainers today.

TCS, HCL Tech, and Tech Mahindra on the other hand, were among the top losers today.

The GIFT Nifty ended at 24,389 up by 15points.

Broader markets ended the day mixed. The BSE Mid Cap ended 0.3% lower and the BSE Small Cap index ended 1.6% higher.

Sectoral indices are trading on a mixed note with stocks in the capital goods sector, and healthcare sector witnessing buying. Meanwhile, the stocks in the IT sector and media sector witnessing selling pressure.

Shares of Crisil, Fortis Healthcare, and Piramal Pharma hit their respective 52-week highs today.

The rupee is trading at 84.09 against the US$.

Gold prices for the latest contract on MCX are trading 0.3% lower at Rs 79,462 per 10 grams.

Meanwhile, silver prices are trading 0.7% lower at Rs 95,920 per 1 kg.

Here are four reasons why Indian Markets are falling today

#1 Weak Q2 Earnings

The September quarter earnings season has soured the mood, as stock prices ultimately reflect earnings in the long run. With many companies falling below market expectations, the number of downgrades has outnumbered upgrades.FY25 will mark the first year of single-digit growth in Nifty earnings over the past five years, following an impressive compounded annual growth rate of over 20% for the previous four years

#2 FII Selling

October has recorded the highest FII outflow from Dalal Street ever, with about $11 billion worth of investments leaving the Indian stock market, surpassing the $7.9 billion in sales seen during the Covid-led market crash in March 2020. When considering the total FII outflow from the secondary market this month, it has already crossed the Rs trillion mark. After accounting for inflows in the primary market due to IPOs, the net

#3 Weak Global Cues

Asian equities fell Thursday after US stocks and government bonds dropped as robust economic data blurred the picture for imminent Federal Reserve rate cuts.

US markets ended lower in mid-week trading as traders digested a slew of economic data and ahead of results from megacap names like Microsoft and Meta Platforms, which reported after the bell.

#4 US Election

The looming US election adds to the uncertainty, with former Republican President Donald Trump and Democratic Vice President Kamala Harris engaged in a tight race for key competitive states ahead of the November 5 voting day.
 

Ashoka Buildcon's ACL Stake Acquisition

In news from the construction sector, Shares of vvcz surged by nearly 7 percent after the company announced its acquisition of an additional 34 percent stake in Ashoka Concessions Ltd (ACL) for Rs 1,526 crore. This acquisition will make ACL a wholly-owned subsidiary of Ashoka Buildcon.

The transaction provides an exit for investors, including Macquarie SBI Infrastructure Investments and SBI Macquarie Infrastructure Trust. With this, Ashoka Buildcon consolidates its investment in ACL, which oversees the group's Build-Operate-Transfer (BOT) and annuity highway projects.

In conjunction, Viva Highways, a subsidiary of Ashoka Buildcon, will acquire a 26 percent equity stake in Jaora Nayagaon Toll Road Company for Rs 150 crore.

These transactions, detailed in agreements dated October 30 are subject to regulatory approvals from the lenders, NHAI, MPRDC, and the Competition Commission of India.

Ashoka Buildcon, a Fortune India 500 company, develops and maintains infrastructure in India and abroad, with projects spanning roads, bridges, buildings, power, railways, and city gas distribution systems.

The company serves national and state governments and operates through multiple business models, including Engineering, Procurement, and Construction (EPC), BOT, and Public-Private Partnership (PPP).

Nifty It Index Tumbles Nearly 3%

Moving on, the Nifty IT index dropped nearly 3% on October 31 after US big tech stocks underperformed in their earnings reports. Meta Platforms announced weaker-than-expected user numbers in its third-quarter results, while Microsoft's revenue growth guidance fell short of expectations.

Overnight, the US information technology sector was the largest decliner, falling 1.3%.

Meta reported a 19% year-over-year increase in third-quarter sales, with net income growing 35% to $15.7 billion from $11.6 billion a year earlier.

However, this marked Meta's lowest year-over-year net income growth since the second quarter of 2023.

The company also warned of a significant acceleration in infrastructure expenses in 2025. Meta reported 3.29 billion daily active users, up 5 percent year-over-year, but slightly below analysts' expectations.

Meanwhile, Microsoft beat earnings and revenue estimates for its fiscal first quarter but forecasted slower growth than anticipated. Revenue for the quarter ending September 30 increased 16% year-over-year, with net income rising 11% to US$ 24.67 bn from US$ 22.29 bn in the same period last year.

While IT companies are observing some improvement in overall demand, discretionary spending has not yet picked up. However, we expect that increased cloud spending in FY25, after a modest FY24, will revitalize discretionary spending for IT services in H2 FY25 or FY26. This robust cloud growth, reminiscent of FY22, bodes well for Indian IT service companies and is likely to enhance overall growth.

More By This Author:

Sensex Today Trades Lower; Nifty Below 24,350; Cipla Rallies 10%
Sensex Today Ends 426 Points Lower; Nifty Below 24,350
Sensex Today Trades Lower; Nifty Below 24,400; Cipla Down 4%