The stock market was closed on 3rd on the occasion of Holi. But today Holi is being celebrated in most areas of the country. The stock market is also open today. But even on the day of Rangotsav, the decline in paint companies continues. Amidst the ongoing tension in the Middle East, there was a severe fall in the shares of major paint companies of the country on the trading day i.e. March 2. The same trend of decline continues on March 4 also. From Asian Paint to Burger Paint, everyone’s shares have fallen on BSE.
In early trade, till the time of writing the news, the shares of Asian Paint are trading at Rs 2,253 with a decline of about two and a half percent. At the same time, selling is clearly seen in the shares of other major paint companies like Burger and Indigo Paints. Like Asian Paint, shares of Burger Paint are trading at the level of Rs 436 on Wednesday with a decline of about 2.5 percent. Apart from this, shares of Indigo Paint Limited are down by about one and a half percent at Rs 903.
Why are these stocks falling?
Many important raw materials used in the paint industry are prepared from petroleum. In such a situation, when the price of crude oil increases, the production cost of companies directly increases. In the current situation, the price of Brent crude has jumped by more than 6% to around $ 77 per barrel. About 20% of the global oil supply passes through the Strait of Hormuz and the fear of supply disruption has deepened due to increasing attacks and threats to ships in this region.
Due to the fear of oil becoming expensive, investors have started selling shares of paint companies. On Monday, shares of Asian Paints fell more than 3% to around Rs 2,298, which is the lowest level in several months. Indigo Paints recorded a weakness of about 6%, while shares of Berger Paints also slipped by more than 5% to reach the year’s lowest level. It is clear that the market is worried about increasing pressure on the profits of companies in future.
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