Closing Bell: Nifty ends below 17,800, Sensex falls 335 points; Adani Ports gains 9%

Taking Stock | Nifty ends below 17,800 and Sensex falls 335 points amid volatility; Adani Ports top gainer

The BSE midcap index added 0.7 percent and smallcap index rose 0.5 percent.... Read More

Markets started the week on a subdued note and lost nearly half a percent, tracking feeble global cues. After the initial dip, the Nifty index hovered in a narrow range till the end and finally settled at 17764.60 levels. Meanwhile, a mixed trend on the sectoral front and selective buying on the broader front kept the participants busy.

The recent price action on the benchmark front indicates uncertainty among the participants and that might continue in the near term.

Traders should thus maintain their focus more on identifying opportunities in the sectors that are showing resilience. However, it’s easier said than done as we’re seeing restricted participation. Also, managing overnight risk is equally important citing the prevailing volatile scenario.

The Nifty opened on a negative note on February 06 & moved lower in the beginning of the session. However, the key hourly moving averages offered support on the downside & restricted further downside.

Consequently, the index traded in a sideways manner as the day progressed & ultimately formed an Inside bar on the daily chart. Going ahead, 17,700 & 17,870 are key support & resistance respectively.

The index has a potential to stretch towards the 18,000 mark as long as it stays above 17,700.

A strong job market in the United States pushed the global market lower on rate hike fears, as it offers the Fed more leeway in enacting stricter policy measures. This was in contrast to the recent rally in the global indices on the expectation that the economy is in its last phase of policy tightening.

RBI’s policy announcement on Wednesday will provide more colour on its future rate actions, which is expected to hike rate by 25bps.

While the sentiment has been sluggish over the past week or so, today's fall can be attributed to weak Asian cues and cautious approach from the investors ahead of the RBI's credit policy.

Selling seemed to have been triggered by further strengthening of dollar against the rupee, leading to weakness in metal, power & select banking stocks.

Moreover, markets may continue to witness bouts of intra-day volatility due to lack of any fresh positive triggers in the global arena.

Technically, the Nifty hovered between 17,700 to 17,800 price range. On daily charts the index has formed a small inside body bearish candle which is indicating the continuation of a non-directional activity in the near future.

For Nifty, 17,700 would be the key support level and below the same the index could slip till 17,600-17,520. On the flip side, a fresh rally is possible only after the dismissal of 17,825 and above the same, the index could rally till 17,900-17,925.

Foreign portfolio investors (FPIs) offloaded Indian equities worth 288.52 billion rupees ($3.51 billion) in January, the most since June, data from National Securities Depository Ltd. showed.

The selling coincided with a slide in equity benchmarks, with Nifty 50 falling 2.45% in the first month of 2023.

Analysts cited multiple reasons - the uncertainties due to a sharp selloff in Adani group stocks after a Hindenburg Research report flagged concerns over the conglomerate's financials, expensive valuations of Indian shares over their global peers, reallocation of funds to China and Taiwan for their relatively cheaper valuations, and Beijing's reopening, easing COVID-19 controls.

Indian rupee closed 90 paise lower at 81.73 per dollar against previous close of 81.83.

Adani Transmission has reported 77.8 percent jump in its Q3FY23 net profit at Rs 474.7 crore against Rs 267 crore and revenue was up 22% at Rs 3,551.7 crore versus Rs 2,911.7 crore, YoY.

Adani Transmission was quoting at Rs 1,261.40, down Rs 140.15, or 10 percent.

: Benchmark indices ended lower on February 6 with Nifty below 17,800.

At Close, the Sensex was down 334.98 points or 0.55% at 60,506.90, and the Nifty was down 89.40 points or 0.50% at 17,764.60. About 1850 shares have advanced, 1653 shares declined, and 185 shares are unchanged.

Divis Laboratories, Hindalco Industries, JSW Steel, Tata Steel and Kotak Mahindra Bank were among the biggest losers on the Nifty, while gainers were Adani Ports, IndusInd Bank, BPCL, Hero MotoCorp and Apollo Hospitals.

On the sectoral front, metal and power indices shed 1-2 percent, while capital goods, FMCG and realty up 0.5 percent each.

The BSE midcap index added 0.7 percent and smallcap index rose 0.5 percent.

The dollar held firm against the euro on Monday, with traders taking the view the U.S. Federal Reserve will likely lift its benchmark rate above 5% and keep it there to squeeze inflation after data showed the labour market remains strong.

An earthquake in central Turkey and northwest Syria and a strong U.S. dollar added pressure on emerging currencies sending Turkey's lira to a record low of 18.85 against the dollar.