Nifty snaps 4-day gaining streak, ends below 8,300 after two sessions; what led last hour sell-off

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Published: March 30, 2020 4:15:17 PM

Six stocks out of 30 Sensex stocks settled in a positive territory today, with Nestle India as the top gainer, up 4.49 per cent, followed by Tech Mahindra, Axis Bank and HUL

Halting the 4-day gaining streak, Nifty 50 index settled nearly 5 per cent down in Monday’s  volatile session as the novel coronavirus cases continued to dictate market movement in India and elsewhere. S&P BSE Sensex ended over 1,300 points down while the broader Nifty 50 index finished below the crucial 8,300 level. “During the afternoon session markets have shown some recovery but failed to sustain the strength and sold off near closing session as traders remained concerned with reports of Icra expecting India’s gross domestic product (GDP) to contract by 4.5% in the April-June 2020 quarter and will rise by only 2% in 2020-21 on the coronavirus impact, despite the Reserve Bank of India’s (RBI) massive actions to spur the economy,” Narendra Solanki, Head Fundamental Research, Anand Rathi Shares and Stock Brokers, said.

Nifty erases gains from last two session-  S&P BSE Sensex ended 4.6 per cent or 1,375 points lower at 28,440, while the broader Nifty 50 index finished 370 points or 4.28 per cent at 8,289.

Nestle India climbs 4.5%- Six stocks out of 30 Sensex stocks settled in a positive territory today, with Nestle India as the top gainer, up 4.49 per cent, followed by Tech Mahindra, Axis Bank and HUL. Conversely, Bajaj Finance was the top Sensex laggard, down 12 per cent to Rs 2,243. HDFC, Tata Steel and ICICI Bank were among other Sensex losers.

Nifty Bank index hit harder- Barring Nifty FMCG and Pharma index, all the sectoral indices finished in red. Nifty Bank index dropped  6 per cent dragged by Bandhan Bank, Federal Bank and HDFC Bank. While Nifty Pharma index gained 1.36 per cent, led by Cipla, Lupin and Dr. Reddy’s.

Technical Observation- Broader Nifty 50 index snapped the four-day rally and closed below 8,300 level after two sessions. “After showing higher levels weakness on Friday, Nifty shifted into a profit booking mode on Monday and closed the day lower by 4.3%. A small body of negative candle was formed today with gap down opening and upper shadow. The opening downside gap has been filled partially. Technically, this pattern indicates a profit booking in Nifty and also sell on intraday rise, post sharp upside bounce of last week,” Nagaraj Shetti, Technical analyst, HDFC Securities, said.

Fitch, India Ratings cut India growth forecast- Fitch Solutions slashed its estimate for India’s GDP growth in the fiscal starting April 1 to 4.6 per cent due to weaker private consumption and contraction in investment amid coronavirus outbreak, costing economies around the globe. On the other hand, India Ratings (Ind-Ra) cut its FY21 growth forecast to 3.6 per cent amid coronavirus-related worries.

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