Today’s Cue Bond yields and weak auto sales drag the Nifty toward 22,300
A global jump in bond yields and September auto sales that missed estimates pushed the Nifty down more than 1% by early afternoon, with the selling spread across most of the market.
The overnight cue came from the bond market. The US 10-year yield climbed above 5.25%, a level not seen since 2007, and higher yields tend to pull money out of equities, especially in emerging markets. Europe and the Dow were lower and GIFT Nifty pointed to a weak start, which is how the day began.
Then came the auto numbers. Sales for September fell short of estimates, and the Nifty Auto index dropped close to 4%, the weakest sector of the day, with Bajaj Auto down more than 6%. Media, metals and realty also lost over 2%. In the Nifty 500, only 58 stocks were rising against 442 falling, and the India VIX jumped more than 13% to about 15.3, a sign that traders are paying more for protection.
The Nifty was trading near 22,340, down about 1.25%, so the 22,300 mark is the level to watch. Weak auto volumes and costlier money raise questions about earnings for the July–September quarter, whose results begin next month. Crude was up about 2% and the rupee weaker near 96.4 to the dollar, which adds to the pressure.