The benchmark BSE Sensex fell to a one-month closing low on Wednesday, falling for the third straight session, as metal stocks such as Hindalco Industries plunged over an investigation into the allocation of coal blocks.
Extending its fall to the third straight session, the Sensex closed down by over 50 points at fresh one-month low of 28,659.17 today on selling in metal, healthcare, oil & gas and capital goods stocks amid sustained fund outflows.
In volatile movements, the 30-share BSE index opened higher at 28,725.75 on the back of value-buying in select stocks. However, it soon came under pressure as participants preferred to book profits at every rise, leading to the index touching a low of 28,608.18.
While a round of late buying in select bluechip stocks, helped the Sensex to touch day’s high of 28,843.23 but it lost momentum again. It closed at 28,659.17 points – its weakest level since February 11 – down 50.70 points, or 0.18 per cent. The gauge has lost nearly 790 points in three sessions.
Market Outlook by Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services
As we see India has been impacted along with EMs with global concerns. This consolidation will be a healthy opportunity for the long-term. The US interest rate hike will bring an important change to the cost of liquidity. Hence till this change, we will see currency volatility. As far as domestic factor is concerned, we will look at the performance of budget session – Lok & RajyaSabha. Added, due to poor Q3 results, the expectation for Q4 has been downgraded. Hence as per the outcome of this session, the trend of current consolidation will be decided.
The broad-based Nifty of the NSE slipped below the 8,700-mark by falling 12.10 points, or 0.14 per cent, at 8,699.95. It shuttled between 8,755.60 and 8,682.35 in intra-day trade. The gauge has lost 237.80 points in 3 days.
Hindalco was the top loser among Sensex and Nifty stocks by slumping over 5.5 per cent after its promoter Kumar Mangalam Birla was summoned as accused by a special court in coal scam case.
Pharma stocks, which have been outperforming the benchmark indices in the past few trading sessions, also came under selling pressure. Cipla and Sun Pharma fell.
Shrikant Chouhan, Head-Technical Research, Kotak Securities
On Wednesday, the market opened higher on the back of positive news flow on Current account deficit which came in lower than expectations of the street. However, positive opening failed to hold initial gains due to weakness in Asian markets and weaker trend of Indian currency against Dollar. Technically, even though the Nifty closed below 8700 it sustained well above the crucial level of 8660. Below 8660 level the fall may accelerate to 8600/8580 in the near term. In case if global cues remains strong then higher opening is not ruled out but that should be utilized to reduce weak long positions.
Brokers said reports of selling by foreign funds after remaining net buyers for several sessions on the domestic bourses, and profit-booking by retail investors after recent gains and weakness in the rupee, dampened sentiments.
Foreign institutional investors have sold shares worth Rs 748.13 crore yesterday, as per provisional data. Mixed trends at other Asian markets and a higher opening in Europe also influenced trading here, they added.
Market Wrap Up by Alex Mathews, Head Research, Geojit BNP Paribas Financial Services
The domestic markets witnessed a volatile session tracking the global cues. The rupee’s fall against dollar also kept the markets under pressure. Markets are very close to oversold territory, which again can increase volatility in the days to come.
Nifty closed at 8699 down around 12 points. The market breadth remained negative as there were seen 1186 stocks advancing against 1636 stocks declining. The Nifty volatility index, India VIX stood at 15.1300 down around 2.59%.
The Mid cap and small cap indices had underperformed the broader indices closed down around 0.44% and 0.32% respectively.
The major sectorial losers for the day were Metal and Healthcare, which closed lower around 1.69% and 0.93% respectively. On the other side, the gainers were Realty and Power which closed up around 0.48% and 0.11% respectively.
In the stocks’ front, selling was seen in Hindalco and Cairn, closed down around 5.11% and 2.88% respectively and on the other end the buyers were Bharti Airtel and NTPC which closed up around 5.99% and 3.10% respectively.
After a couple of days the FIIs became net sellers in cash markets segment, sold shares worth Rs 748.13 crore on Tuesday, 10 March 2015. On the other hand the DIIs were net buyers on 10 March 2014, bought shares worth Rs 290.48 crore as per the provisional data from the stock exchanges.
On the back of the region’s central banks buying sovereign bonds for third day, the European markets recovered. The US index futures were with a positive note.
In the economic front, inflation rate, industrial production and manufacturing production may be major triggers for the Indian markets.
Telecom stocks such as Airtel, Idea and RCom remained in the limelight for the second straight day today, surging up to 6 per cent after companies were seen successfully securing most of their spectrum needs at the ongoing auction.
Sectorwise, the BSE Metal index suffered the most by falling 1.64 per cent, followed by Oil&Gas by 0.84 per cent, Healtchare by 0.82 per cent and Capital Goods by 0.54 percent.
Selling pressure in small and midcap stocks also pulled down the BSE Small-cap index by 0.32 per cent and Mid-cap index by 0.40 per cent.
