BSE Sensex and NSE Nifty ended nearly 1 percent lower on Friday, dragged down by ICICI Bank on concerns over its exposure to debt-laden Jaiprakash Group, while Reliance Industries fell ahead of its quarterly results later in the day.
ICICI Bank fell 4 percent after CARE downgraded Jaiprakash Associates debt, while Reliance Industries fell 1.6 percent.
Market Outlook by Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services
The recent rally to 8650 (Nifty) levels was led by the easing of global risk and signs that earnings downgrade will end in India. But the market is not finding any supporting factor to hold its strength. The market was depending on Q1FY16 results for providing support to the earnings outlook and parliament session to kick start reforms, but the market’s confidence is now in question.
BSE Sensex and NSE Nifty extended their downtrend on Friday, tracking muted trends across most of the global markets. Disappointing quarterly earnings from some bluechip companies too weighed on the sentiments and prompted funds and investors to go for selling on the final session of the week.
Traders were concerned with the Parliament heading towards a washout for the fourth consecutive day. Lok Sabha was adjourned till Monday, while Rajya Sabha witnessed continuous adjournments.
Market Wrap Up by Alex Mathews, Head Research, Geojit BNP Paribas Financial Services Ltd
After a flat opening, the market slowly and steadily declined on absence of fresh triggers. Investors were staying side lines ahead of the corporate earnings, and no positive surprises were seen as of now and also of the weak Chinese weak manufacturing activity. Heavy weights like ICICI Bank, Tech Mahindra and Reliance may announce their earnings in the coming week will give fresh triggers for the market, and futures and option expiry on the next week is also closely watched by the participants.
Nifty today closed at 8521 down around 68 point. The market breadth changed to negative as there were seen 1275 stocks advancing against 1585 stocks declining. The Nifty volatility index, India VIX stood at 15.4575 down around 0.40%. The mid-cap and small cap sectors ended down around 0.57% and 0.60% respectively.
Capital goods and Realty were the major losers in the sectorial front, ended down around 1.57% and 1.32% respectively. On the other side, buying was seen in FMCG and Consumer Durables, which ended up around 0.12% and 0.06% respectively.
The gainers in the stocks’ front were Tech Mahindra and Bank of Baroda, closed up around 2.29% and 1.31% respectively. Selling was seen in ICICI Bank and Wipro which ended down around 3.68% and 3.64% respectively.
The FIIs were net buyers in the cash market segment on 23 July 2015, Wednesday, bought shares worth Rs 185.42 crore. The DIIs on the other hand were sellers on 23 July, sold shares worth Rs 276.69 crore in the capital markets segment.
The European markets reversed their movements after better corporate earnings. The US index futures were also up.
On Monday companies like Ambuja Cements, Binani Industries, Century Enka, DIC India, KEC, KPR mill, MRF, OCL India, Orient Refractories, Subros, Tech Mahindra, TRF, Ucal Fuel, TFCIL and Torrent Pharma may come out their earnings.
Adding to the woes, a private poll report stated that India’s economic prospects have dimmed since April due to the government’s inability to pass much-needed reforms. Growth forecasts too were nudged down from April owing to concerns the government still faces substantial challenges in kick-starting a reform-driven growth cycle.
On the global front, after the US markets ended in red the Asian markets followed the trend and ended in sea of red.
Market View by Anand James, Co Head Technical Research Desk, Geojit BNP Paribas
While earnings numbers kept stocks volatile, buyers were found less keen to make decisive moves, ahead of key interest rate decisions. But the week’s lows were threatened again in Nifty and bank indices, after government mooted draft financial code, deviating from recommendations put forward by the Urjit Patel committee, the RBI’s internal panel. The possibility that such a move, though only at draft level now, could clip RBI’s autonomy and undermine its ability to rein in inflation, may weaken market’s risk taking resolve.
Markets after witnessing volatility in last session, extended their disappointments, with ears taking the full control, keeping the benchmarks in red throughout the day, there was hardly any attempt of recovery, while the selling aggravated in the final hours dragging the benchmarks below the 28300 (Sensex) and 8550 (Nifty) level, closing near the lows of the day.
The BSE Sensex ended at 28123.53, down by 247.31 points or 0.87% after trading in a range of 28083.76 and 28402.64. There were 10 stocks in green against 20 stocks in red on the index.
Market View by Gaurav Jain, Director, Hem Securities
Markets witnessed sharp sell-off during the last hour of trade on the back of weak global cues. Investors seem to be skeptical about the passage of GST (Goods & Service Tax). Weakening of rupee also weighed on the sentiment.
The top gainers on the Sensex were Sun Pharma Inds. up by 1.02%, Hero MotoCorp up by 0.76%, Cipla up by 0.62%, TCS up by 0.61% and Bajaj Auto up by 0.49%.
On the flip side, Wipro down by 3.79%, ICICI Bank down by 3.76%, Lupin down by 2.93%, Tata Motors down by 2.70% and SBI down by 2.34% were the top losers.
The top gainers on Nifty were Tech Mahindra up by 2.20% and Bank Of Baroda up by 1.96% and Sun Pharma Inds. up by 0.89% and Hero MotoCorp up by 0.84% and Cipla up by 0.73%. On the flip side, ICICI Bank down by 3.93%, Wipro down by 3.79%, Lupin down by 3.25%, Tata Motors down by 2.77% and SBI down by 2.52% were the top losers.