New Delhi, Jan 8 (IANS): BSE Sensex was down more than 500 points in afternoon trade on Monday due to weakness in FMCG, banks and IT stocks.

BSE Sensex was trading down 580 points at 71,444 points. SBI is down more than 2 per cent, ICICI Bank and Axis Bank are down 1 per cent. FMCG stocks are weak with HUL, Nestle, Asian Paints down more than 1 per cent. M&M, Tech Mahindra, and TCS are down more than 1 per cent.

The year-end rally, which took the Nifty up by around 14 per cent from the 2023 October lows, is slowly running out of steam, says V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

The major challenge for the rally comes from the US market which is showing signs of weakness.

The concern in the US now is that the market expectation of a rate cut in March may not materialise since the labour market continues to be tight and the unemployment data is lower than expected.

Inflation coming under control means that the rate hiking cycle is over and the Fed pivot is imminent. But the market will be disappointed if the rate cut doesn’t happen in March. The sign of this possible trend can be seen in the firming up of the 10-year US bond yield above 4 per cent, he said.