During the day’s volatile trading session, the last hour sell-off is what led the markets to decline and end the day with minor losses.
After opening in the green, equity markets ended Tuesday’s session with minor losses with the Nifty declining by 37.7 points or 0.33% to close at 11,317.35. Sensex was down by 51.88 points or 0.14% to close at 38,365.35. The markets pared their gains tracking the weak opening of European equities.
During the day’s volatile trading session, the last hour sell-off is what led the markets to decline and end the day with minor losses. The European markets were trading lower after tensions weighed down their equities, which were cautious over Brexit. The UK’s FTSE 100 was down by 23.43 points or 0.39% at the time of press. France’s Cac 40 and Germany’s Dax were down by 1.4% and 0.98%, respectively. The Dow Jones Mini futures were down by 49 points ahead of the US market opening. Asian markets in Hong Kong, China and South Korea had a strong trading session and were up between 0.14% and 0.74%. Deepak Jasani, head – retail research, HDFC Securities, said, “Indian equity benchmark indices ended lower after forming a top around noon. Weakness in the European markets (tech sector) sparked a mild sell-off post noon in Indian markets.”
So far in September, foreign portfolio investors (FPIs) have remained marginal sellers, offloading Indian equities worth $120.9 million. On Monday, FPIs sold stocks worth $9.1 million along with domestic institutional investors (DIIs), who sold stocks worth $107.34 million. The futures and options segment saw a turnover worth Rs 15.29 lakh crore against the six-month average of Rs 15.42 lakh crore. The cash market, on the other hand, saw a turnover worth Rs 49,648.36 crore against the six-month average of Rs 53,128 crore.
Strategists have said the economic impact of Covid-19 is mixed and it could impact the market’s valuations. ICICI Securities, said, “High-frequency data of economic activities for August is mixed. Covid-19 impact of a sharp dip in forward earnings growth and marginal dip in ‘discount rate’ will provide headwinds to the current bull market rally in Indian stocks as valuations rise above one standard deviation, on a rolled forward price earnings ratio basis.”
The biggest losers on Nifty were Bharti Infratel, Zee Entertainment, Tata Motors, Tata Steel, and Hindalco down by 7.8%, 5.11%, 4.72%, 4.38%, and 4%, respectively. The biggest gainers were BPCL, HCL Technologies, Infosys, Wipro, and Reliance Industries up by 2.65%, 1.84%, 1.49%, 1.26%, and 0.98%, respectively.