The Indian equity market carried forward the previous week's sell-off and ended lower for the third consecutive session on March 13 amid weak global cues following the sudden collapse of three banks — Silicon Valley Bank, Silver Gate and Signature — in the US.
At close, the Sensex was down 897.28 points, or 1.52 percent, at 58,237.85, and the Nifty was down 258.60 points, or 1.49 percent, at 17,154.30.
After a flat start, the market gyrated between gains and losses in the first half but extended selling in the second half pulled the 30-pack Sensex down 1,000 points and the Nifty closer to 17,100.
"Bloodbath was seen in the global market as the fallout of Silicon Valley Bank was followed by turmoil at Signature Bank, keeping investors worried about the strength of the US banking system," said Vinod Nair, Head of Research at Geojit Financial Services.
"Importantly, the Fed’s decision in the upcoming meeting will have a crucial impact on the market sell-off, as the consensus is reversing to no rate hike trajectory. Also, the US inflation due on Tuesday will have a vital impact in the short-term as the market anticipates a cool down from January levels," he added.
Also Read: HSBC acquires Silicon Valley Bank's UK unit for £1
Stocks and sectors
IndusInd Bank, SBI, Tata Motors, M&M and Eicher Motors were among the major losers on the Nifty, while gainers were Tech Mahindra and Apollo Hospitals.
All the sectoral indices ended in the red with Nifty bank, Auto and PSU Bank down 2 percent each, while infra, metal and information technology down 1 percent each.
The BSE midcap index shed 1.8 percent and smallcap index fell 2 percent.
On the BSE, auto, bank, realty fell 2 percent each, while capital goods, information technology, metal and FMCG down 1 percent each.
More than 200 stocks touched their 52-week low on the BSE, including Tata Consumer Products, Tide Water Oil, Pfizer, Nazara Technologies, Laurus Labs, Ipca Laboratories, Hathway Cable & Datacom, Gati, Coffee Day Enterprises, Crompton Greaves Consumer Electricals and Aarti Drugs.
Among individual stocks, a volume spike of more than 300 percent was seen in Tech Mahindra, IndusInd Bank and ICICI Lombard General Insurance Company.
A short build-up was seen in IndusInd Bank, Au Small Finance Bank and Piramal Enterprises, while a long build-up was seen in Tech Mahindra, ICICI Lombard General Insurance Company and Apollo Hospitals.
Outlook for March 14
Ajit Mishra, VP - Technical Research, Religare Broking
Markets started the week on a feeble note and lost nearly one and a half percent, in continuation to the prevailing trend. After the initial uptick, the Nifty index gradually drifted lower as the day progressed and finally settled at 17,154.30 levels. The selling pressure was widespread wherein banking, auto and IT majors were beaten down badly. The broader indices too plunged sharply lower and lost nearly 2% each.
The move shows that participants are not comfortable, citing the US banking crisis and reducing positions, ignoring the news of the bailout. Banking and financials were acting as saviors earlier but the tone has changed completely now, which is further adding to their worries. We reiterate our negative view and eyeing the 17,000 level as immediate support in Nifty. Traders should align their positions accordingly.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services:
Domestic indices witnessed renewed selling pressure on account of issues within the US banking space. Nifty opened positive but soon came under intense selling pressure to close with loss of 257 points (-1.5) at 17156 levels. All sectors ended in red with banking and auto facing the major burnt, down 2% each.
India Vix jumped sharply by 19% to 16 levels, indicating heightened volatility. Emerging uncertainty around several mid and small size (Silvergate Bank, Sillicon Valley Bank, Signature Bank and First Republic Bank) have created nervousness among global investors about the health of the US banking sector.
Expect elevated volatility until clarity emerges on the potential extend of the crisis. The US Fed’s emergency meeting to control the damage would be crucial for the markets. Apart from this release of India and US inflation data along with ECB meeting during the week would be keenly watch.
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