Stock Market / Indian stock market broke for the second consecutive week, the shadow of Russia-Ukraine crisis on the global market

In the week ended February 18 also, the Indian equity market remained on the red mark with a fall. This is the second consecutive week that the market is in a downward spiral. In this week, the BSE Smallcap index lost more than 3 per cent, while the Midcap index lost 2 per cent. Talking about the large cap index, it has registered a decline of 0.7 percent.

These are the main reasons for this decline

If we look at the reason for the bad phase of the stock market, which has continued for two consecutive weeks, then rising geopolitical tensions, rise in crude oil prices and continuous selling of foreign institutional investors (FIIs) have been the main reasons for the fall. It is worth noting that last week the market started with the biggest one-day fall in a year, although after that some recovery was seen the next day. But this rise was only for one day and in the remaining 3 days of the week, the market again saw a decline.

Smallcap index fell 3%

The BSE Smallcap index lost over 3 per cent last week. There were about 16 stocks in the smallcap index, which saw a fall of more than 15 percent. On the other hand, there were 12 smallcap stocks in which there was a rise of 10 to 29 percent. Apart from this, the BSE Midcap index saw a fall of 2 per cent, including REC, Gland Pharma and Godrej Industries fell heavily. If we look at the BSE Largecap index, it fell 0.7 percent last week, Piramal, NMDC, Ambuja Cement, Bank of Baroda were the biggest contributors to this decline.

Big fall in banking stocks

If we look at the move of BSE Sensex, the market cap of ICICI Bank saw the biggest fall last week. After this big names like ITC, SBI were included in the declining list. If we look at different sectors, the Nifty PSU Bank index declined by 4.6 per cent, metal index by 4 per cent and Realty index by 2.7 per cent.

FII sells heavily

For the week ended February 18, FIII sold Rs 12,215.48 crore in the Indian market, while DII bought Rs 10,592.21 crore. According to the report, FIIs have sold Rs 21,928.08 crore so far in the month of February, while DII has sold Rs 16,429.46 crore. The rupee on a weekly basis gained 71 paise to close at 74.66 against the dollar for the week ended February 18.

Bad condition of global market

The impact of the troubled environment between Russia and Ukraine was clearly visible on the global market. If we look at the US market, for the second consecutive week in the week ended February 18, the US markets also closed in the red mark. US-Russian tensions over Ukraine have affected market sentiment. The S&P 500 declined 1.6 percent, the Dow 1.9 percent and the Nasdaq 1.8 percent in the week ended. High-growth stocks like Apple, Amazon and Microsoft were the biggest contributors to this decline.

US Fed's move

Apart from the Ukraine crisis, speculation on the next move of the US Fed also showed its impact on the equity market. New York Fed Bank President John Williams said it would be better to hike interest rates in March. In this regard, Morgan Stanley expects that the US Federal Reserve may raise the interest rate not once or twice but six times this year. According to a research report released by Stanley recently, in the year 2022, the US Fed Reserve can increase the interest rate by 150 basis points or 1.50 percent in 6 times.