Sensex, Nifty 50 close flat, mid & small-cap stocks bleed amid hawkish Fed, rising geopolitical tensions

Mint

5 hours ago

Stock market today: Indian stock market witnessed another lackluster performance during Thursday's trading session, June 19, as weak global cues and a lack of fresh domestic triggers kept investors away from risky assets, leaving the frontline indices largely unchanged.
While blue-chip stocks saw little movement, mid- and small-cap stocks faced heavy selling pressure throughout the day, as their expensive valuations raised investor concerns amid ongoing market challenges.
The Nifty 50 shed 19 points, or 0.08%, to close at 24,793 while the Sensex ended 83 points lower, or 0.10%, at 81,361. The Nifty Midcap 100 and Nifty Small Cap each lost nearly 2% in trade.
As widely expected, the US Federal Reserve kept its policy rate unchanged for the fourth consecutive time but warned that Donald Trump's trade policies could drive up prices. Policymakers revised their Personal Consumption Expenditures (PCE) inflation forecast for 2025 to 3.0%, up from the earlier projection of 2.7%, and consequently lowered the GDP growth forecast for 2025 to 1.4% from 1.7%.
Policymakers expressed concerns that Trump's policies are already starting to impact the economy. Their remarks aligned with recent warnings from the IMF and the World Bank. The Fed also signaled a slower pace of rate cuts, now projecting only two reductions by the end of the year.
On the geopolitical front, tensions between Iran and Israel have entered their seventh day, with no signs of de-escalation. In a fresh barrage of attacks, Iran launched 25 missiles in a fresh attack on Israel, with missiles reportedly taking down the Israeli stock exchange building.
On Wednesday, Donald Trump confirmed he was considering a military strike on Iran's nuclear facilities, although he stated that no final decision had been made.
In response, Iran's Supreme Leader, Ayatollah Ali Khamenei, warned the US of 'irreparable damage' if it proceeds with military action—indicating that the ongoing Middle East conflict may persist in the coming days.
On the domestic front, the Indian economy showed early signs of slowing income growth. Advance tax collections by the Centre rose by only 4% year-on-year to ₹ 1.54 trillion as of June 15 in FY26. This is a sharp drop from the 27% growth recorded during the same period last year, primarily due to lower personal income tax payments.
Public sector banks—particularly mid- and small-cap counters—saw a sharp sell-off in today's trading session, resulting in a 2% drop in the Nifty PSU Bank index, making it the worst-performing sector of the day. Media stocks, which had remained resilient in recent sessions, also came under pressure, with the Nifty Media index falling 1.78%.
The decline in real estate stocks continued, sending the Nifty Realty index down 1.55%, while metal stocks also remained weak, pushing the Nifty Metal index lower by 1.21%. Hawkish commentary from the US Federal Reserve weighed on IT stocks as well, with the Nifty IT index losing 0.96%.
On the positive side, Nifty Auto was the only sectoral gainer, managing to defy the broader trend and ending the session with a gain of 0.50%.
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