Domestic benchmark indices snapped the three-day winning streak on Friday and settled lower. Weak global cues dented the sentiments at Dalal Street as the inflation worries spooked the traders. Selling pressure in select index heavyweights also dragged the indices lower.
Positive global cues pushed the indices higher during the early trade, but the expiry of weekly derivative series increased the volatility at Dalal Street. Analysts expect the street to remain range-bound in the near future.
For the day, BSE Sensex dropped 316.94 points, or 0.52 per cent, to 61,002.57. The Nifty50 declined 91.65 points, or 0.51 per cent, to 17,944.20. Broader markets tanked in tandem with the headline peers as BSE midcap and smallcap declined about per cent, each. India VIX jumped about 2 per cent to the 13.08 level.
Markets witnessed turbulence on the back of weak global cues as investors booked profit in banking, IT and telecom stocks. Rising inflation, US bond yields, and dollar index are once again creating a lot of uncertainty amongst investors, said Amol Athawale, Deputy Vice-President – Technical Research at Kotak Securities.
“For the bulls, 17,900-17,800 would act as a key support zone while 50-day SMA or 18,100 and 18,200 could be the immediate hurdle. On the flip side, the selling pressure could accelerate if the index slips below 17,800 and in case of further correction, it could slip to 17,700-17,650,” he said.
All the sectors of Nifty settled in red for the day. Nifty Realty and PSU Bank indices plunged 2 per cent each. Nifty IT, Private Bank and Pharma indices over a per cent, each. Financial services, metal and media indices dropped about a per cent, each.
Among the Adani Group stocks, Adani Enterprises dropped more than 4 per cent as the Supreme Court refused to accept the Centre’s suggestion in a sealed cover. Adani Transmission and Adani Total Gas hit lower circuits of 5 per cent, respectively. ACC also settled in the red.
Among the gainers, Adani Wilmar, NDTV and Adani Power hit upper circuits of 5 per cent, each. Adani Green Energy and Ambuja Cement rose 2 per cent. Adani Ports also managed to settle with gains.
Barring the Adani Group stocks, Nestle India declined more than 3 per cent after December quarter earnings. IndusInd Bank and SBI Life Insurance dropped 3 per cent each. HDFC Life, Mahindra & Mahindra, State Bank of India, Tata Consultancy Services and HCL Technologies shed 2 per cent, each.
On the contrary, Larsen & Toubro jumped over 2 per cent, whereas Ultratech Cement, Bharat Petroleum and Hero MotoCorp gained 2 per cent, each. Asian Paints, Coal India and Grasim Industries added a per cent, each, during the day.
A lack of major triggers in the domestic market is attracting global cues to dictate the market trend. The US market is facing an unfavorable combination of higher-than-expected inflation and a stronger job market, said Vinod Nair, Head of Research at Geojit Financial Services.
“The PPI (Producer Price Index) in the US came in at 6 per cent, in contrast to the expectation of 5.4 per cent. This suggests that interest rates have not yet peaked and will remain elevated for a long period,” he said.
A total of 3,590 stocks traded for the day on BSE, of which 1,943 ended the day with cuts, while 1,503 settled higher. The remaining 144 stocks ended unchanged. A total of 154 stocks hit an upper circuit on BSE, whereas 203 stocks hit the lower circuit during the trading session.
In the broader markets, Shilpa Medicare surged over 14 per cent after the company’s Bengaluru facility for the manufacture and testing of Orodispersible films and Transdermal systems was successfully registered with the Ministry of Health, United Arab Emirates.
TCNS Clothings jumped more than 12 per cent to Rs 496.90. EKI Energy Services jumped, broke a series of lower circuits and hit an upper circuit of 10 per cent. PTC Industries jumped 9 per cent as its subsidiary received an order from Safran Aircraft Engines. Elecon Constructions and Nelcast were up 9 per cent, each.
On the contrary, Kabra Extrusiontechnik plunged over 6 per cent. Arihant Capital Markets and Parag Milk Foods plunged about 6 per cent each. CarTrade, Sadbhav Engineering, Antony Waste Handling were down 5 per cent, each.
Pricol denied the media reports suggesting the stake sale to Minda Corporation. Broader auto component makers were down more than 4 per cent for the day. Ipca Labs also declined 4 per cent after a disappointing quarterly performance.
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