Benchmark indices ended on negative note with Nifty below 16900 in the volatile session on September 28. At close, the Sensex was down 509.24 points or 0.89% at 56,598.28, and the Nifty was down 148.80 points or 0.87% at 16,858.60.
Indian equity market on September 28 lost further ground and ended lower for the sixth consecutive session amid volatility with selling seen in the metal, power and financial stocks.
The market started the day on a weak note and remained negative for the first couple of hours. However, it saw some recovery in the afternoon trade but last-hour selling dragged the Nifty below 16,900.
At close, the Sensex was down 509.24 points or 0.89 percent at 56,598.28, and the Nifty was down 148.80 points or 0.87 percent at 16,858.60.
“Investors continue to be sceptical of the domestic market's higher premium amid the ongoing global deceleration while foreign investors are fleeing emerging economies in search of safer havens. Although the domestic economy is buoyed by solid fundamentals, the stock market's appetite for risk has been hindered by the rising worries of a worldwide recession,” said Vinod Nair, Head of Research at Geojit Financial Services.
“Domestic investors are turning to IT and pharma companies, which have been in a consolidation phase for the past year and are now gaining from the rupee depreciation.”
“The RBI policy meeting is currently underway, and the central bank is likely to raise repo rates by 35-50 basis points. However, the inflation outlook may soften in reaction to declining commodity prices,” he added.
Hindalco Industries, JSW Steel, ITC, Axis Bank and Reliance Industries were among the top losers on the Nifty. However, gainers included Asian Paints, Sun Pharma, Dr Reddy’s Labs, Eicher Motors and Power Grid Corp.
On the sectoral front, Nifty Bank, Energy, Metal and PSU Bank indices fell 1-2 percent, while the pharma index rose 0.5 percent.
On the BSE, Power, Bank, and Metal indices fell 1-2 percent and FMCG, Oil & Gas and Realty indices shed 0.5 percent each, while the pharma index rose 0.46 percent.
Broader indices - BSE Midcap and Smallcap indices are down 0.4 percent each.
A short build-up was seen in PNB, Samvardhana Motherson International and Chambal Fertilisers and Chemicals, while a long build-up was witnessed in India Cements, Muthoot Finance and The Ramco Cements.
Among individual stocks, a volume spike of more than 100 percent was seen in PNB, Oberoi Realty and Abbott India.
Gland Pharma, Graphite India, Indian Oil Corporation, Mastek, Matrimony.com, Mercator, Natco Pharma and Oil India were among the stocks that touched a 52-week low on the BSE.
On the other hand, Asian Paints and Cipla were among the stocks that touched their 52-week high.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
Markets remained choppy with a sharply downward bias, as investors exited banking and metal stocks ahead of the monthly F&O expiry with the likely rate hike by the Reserve Bank of India and other central banks indicating that bearish sentiment could continue going ahead.
Technically, we are of the view that 17,000 would act as an immediate resistance level. Below which, the correction wave is likely to continue till 16,700-16,650. On the flip side, a short recovery rally is possible only after the dismissal of 17,000. Above the same, the index could move up to 17,100-17,200.
The Nifty is having major support between 16,700 and 16,650, which is an important retracement support level. Buying is advisable in index heavyweight stocks if the Nifty falls to 16,700 levels.
Ajit Mishra, VP - Research, Religare Broking
Markets edged further lower and lost nearly a percent, in continuation of the prevailing corrective phase. After the initial gap-down start, the Nifty recovered sharply in the first half and pared all the losses. However, selling pressure in the latter half pushed the index again to the day’s low. Eventually, the Nifty index settled at 16,858.60 levels. Most sectoral indices, barring defensive viz. pharma and FMCG, traded in sync with the index and ended lower wherein metal, banking, energy and realty were among the top losers.
Markets are not seeing any relief citing feeble global cues, and a breakdown of 16,800 in the Nifty could further dampen the sentiment. Meanwhile, oversold positions in select index majors may result in a marginal bounce in between. We reiterate our view to focus more on risk management and prefer defensive.
Prashanth Tapse - Research Analyst, Senior VP (Research), Mehta Equities
The Nifty joined the global stock market rout on worries that the Federal Reserve's war against decades-high inflation could push the US economy into a downturn. The sentiment at Dalal Street remained clouded by lingering concerns about corporate India’s earnings which could come under heavy pressure from inflation, an economic downturn, and soaring interest rates.
The street will be anxiously awaiting the RBI September MPC Meet outcome to trickle in on September 30.
Technically, the Nifty’s support is seen at the 16,277-16,438 zone. As long as it holds the support level, there is a bright chance that the Nifty could bounce to 17,321 and then at 17,727 mark.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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