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Taking Stock | Market ends lower as Russia-Ukraine tensions weigh on sentiment

On the NSE, all sectors barring IT and auto ended on a positive note. Broader indices performed better than the benchmarks. The BSE midcap and BSE smallcap gained 0.6 and 0.9 percent each

February 23, 2022 / 05:11 PM IST

The Indian equity benchmarks were off to a promising start and largely traded in the green on positive global cues but selling in the final hour saw the Sensex and the Nifty close 0.15 percent lower on February 23.

“As global markets turned positive, domestic indices opened the day on a positive note, however, witnessed high volatility and succumbed to selling pressure to close the day in favour of bears,” said Vinod Nair, Head of Research at Geojit Financial Services.

The 30-pack Sensex opened strong as investor sentiment was lifted by positive cues from Asian markets. It rose to the day’s high of 57,733 but tanked 624 points before ending the day 68.6 points, or 0.12 percent, lower at 57,232.06.

The Nifty, too, swung from gains to losses. It touched the day’s high of 17,221 but lost 193 points to slip to intraday low of 17,028 before closing 29 points, or 0.17 percent, lower at 17,063.

Markets closed below the neutral line as “traders were cautious after Finance Minister Nirmala Sitharaman’s statement that the Russia-Ukraine crisis and the ensuing jump in global crude prices are a challenge to financial stability in India”, said Mohit Nigam, Head-PMS, Hem Securities.

Close

The Russia-Ukraine crisis and soaring fuel costs would keep markets across the globe volatile, experts said.

“After trading calm, the Nifty tanked in the final hours as focus returned to the escalating threat of war. Nervousness also prevailed amidst uncertainty regarding the Biden-Putin summit”, said Prashanth Tapse, Vice President (Research), Mehta Equities Ltd.

Earlier, in response to Russia recognising two separatist-controlled areas in eastern Ukraine, the West slapped sanctions against Moscow.

IndexPricesChangeChange%
Sensex54,326.391,534.16 +2.91%
Nifty 5016,266.15456.75 +2.89%
Nifty Bank34,276.40960.75 +2.88%
Nifty 50 16,266.15 456.75 (2.89%)
Fri, May 20, 2022
Biggest GainerPricesChangeChange%
Dr Reddys Labs4,249.10319.65 +8.13%
Biggest LoserPricesChangeChange%
Shree Cements22,001.20-215.15 -0.97%
Best SectorPricesChangeChange%
Nifty Metal5706.35230.10 +4.20%
Worst SectorPricesChangeChange%
Nifty IT28789.40437.25 +1.54%

The US cut off Russia's access to western financing that will prevent Moscow from issuing sovereign debt in financial markets in the West.

Sanctions also targeted Russia's state-owned banks and three Russians said to be part of President Vladimir Putin's inner circle.

The UK froze assets of five Russian banks and imposed travel bans on three Russian officials, while Germany said it won’t give approval to the Nord Stream 2 pipeline in the current circumstances.

Stock and Sectors

On the NSE, all sectors barring IT and auto ended on a positive note. Nifty realty gained the most, edging higher by 3.15 percent. Nifty PSU bank index gained 1 percent, while Nifty media was up by 0.7 percent.

Nifty Auto was the biggest loser, which ended the day 0.2 percent lower, while Nifty IT was down 0.04 percent.

Broader indices performed better than the benchmarks. The BSE midcap and BSE smallcap gained 0.6 and 0.9 percent each.

India VIX, which indicates the degree of volatility traders expect over the next 30 days, declined 7.95 percent from 26.66 to 24.54 levels.

ONGC, Hero Motocorp, NTPC, Larsen & Toubro and JSW Steel were the top Nifty losers, down 1.17-2.55 percent.

Top Nifty gainers were Kotak Mahindra Bank, Titan Company, IndusInd Bank, Maruti Suzuki and Bharti Airtel, gaining between 0.62 and 2.49 percent.

A long build-up was seen in Crompton, DLF and First Source Solution, while a short build-up was witnessed in Gujarat Gas, ONGC and Vodafone Idea.

Among individual stocks, a volume spike of more than 125 percent was seen in Alembic Pharmaceuticals, more than 86 percent in UBL and 80 percent in Muthoot Finance.

On the BSE, of 3,460 stocks traded, 1,167 declined, 2,197 advanced, while 96 stocks remained unchanged.

Outlook for February 24

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd

Investors traded with caution on the eve of the monthly F&O expiry, which was also reflected in the overall sentiment.

After trading in positive territory for the better part of the session, benchmark indices eased marginally due to selective profit-taking in late trades.

As there are multiple challenges ahead, investors are staying on the sidelines amid worries over the Russia-Ukraine crisis and the subsequent rise in crude prices.

We are of the view that the narrow range activity is likely to continue in the near future.

For the short-term traders, 17,000 is the immediate support and 17,225 the key resistance.

One can expect a quick pullback rally up to 17,150 -17,175 levels, if the Nifty trades above 17,000. However, if the index slips below 17,000, further correction to 16,950-16,850 is possible.

Ajit Mishra, VP-Research, Religare Broking Ltd

Markets traded lacklustre in a narrow range and ended marginally lower. Noticeable action on the broader front kept the participants busy. Most sectoral indices, barring realty, ended flat to marginally lower in line with the benchmark.

Markets are gradually drifting lower amid excessive intraday volatility, mirroring global markets. A mixed trend on the sectoral front is further adding to participants’ worries. In such a scenario, it would be prudent to restrict positions and wait for clarity over the next directional move.

Gaurav Ratnaparkhi, Head, Technical Research, Sharekhan by BNP Paribas

In terms of the price pattern, the Nifty has formed a triangular pattern on the daily chart and is witnessing consolidation within the pattern.

The lower end of the pattern is at 16,800, whereas the upper end is near 17,300. The Nifty is expected to witness further consolidation in this range after which it can resume the larger uptrend.



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Gaurav Sharma
first published: Feb 23, 2022 05:11 pm
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