Sensex fell 250 points from the day's high on October 14, while Nifty dropped below 22,700. Markets saw profit booking and FII selling, which hurt sentiment. Rising crude prices also added pressure. V K Vijayakumar said, "The RBI measures to restrict speculation in the currency market led to 1.5% appreciation in the rupee."
Benchmark indices Sensex and Nifty were trading in red on October 14 after falling from day's high due to various reasons, including profit booking and FII selling.
At 11:33 am, the Sensex was down 96.68 points or 0.13% at 72,937.10, and the Nifty was down 45.55 points or 0.2% at 22,676.40. About 2,300 shares advanced, 1,365 shares declined, and 190 shares were unchanged.
Key factors behind market decline
1) Profit booking
Markets witnessed profit booking after markets rose for 1.6% in the previous session.
2) FII selling
On October 13, FIIs extended their selling streak to 13 consecutive sessions, recording net sales of approximately Rs 1,305 crore, though the pace of outflows moderated.
"The RBI measures to restrict speculation in the currency market led to 1.5% appreciation in the rupee in the last two trading days. This has helped reduce the FII selling in the market significantly," said V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.
3) Technical reason
Nifty needs to decisively trade above 22,750 for follow-up buying in indices, said analysts.
4) Oil prices rise
Oil prices rose to about $107 a barrel as traders weighed supply risks from fighting between Yemen's Iran-allied Houthis and Saudi Arabia against the prospect of increased diesel supplies from Russia.
5) Rising India VIX
India VIX, the volatility gauge, rose over 2% to 14.43 after falling 7% in the previous session.