The Indian market closed deep in the red on March 13 as broad-based selling and the mid and smallcap meltdown continued for another day, spooking investors.
At close, the 30-pack Sensex was down 906.07 points, or 1.23 percent, at 72,761.89, while the broad-based Nifty ended 338.00 points, or 1.51 percent, lower at 21,997.70.
A moderate CPI data and steady industrial production growth helped Indian benchmarks open on a positive note but they failed to hold on the gains as selling intensified in the second half, pushing the Nifty below 22,000.
The biggest Nifty losers included Adani Enterprises, Coal India, Adani Ports, Power Grid Corporation and NTPC, while gainers were ITC, UltraTech Cement, HCL Technologies, Kotak Mahindra Bank and ICICI Bank.
All sectoral indices, except IT, ended in the red, with realty, media, PSU bank, telecom, power, oil & gas and metals down 4-6 percent.
Broader indices underperformed the main indices with BSE Midcap index fell 4 percent, registering steepest fall since December 2021, while Smallcap index plunged 5 percent, a major drag since February 2022.
Among individual stocks, a volume spike of more than 200 percent was seen in Adani Enterprises, Sun TV Network and Colgate Palmolive.
A short build-up was seen in NMDC, RBL Bank and India Cements, while a long build-up was seen in ITC, Abbott India and ICICI Bank.
Outlook for March 14
Ajit Mishra, SVP - Technical Research, Religare Broking
Markets plunged lower and lost ~1.5%, after spending nearly a week in a narrow range. After the initial uptick, Nifty drifted gradually in the initial hours however the pace of decline intensified as the day progressed. Eventually, it settled closer to the day’s low at 21,997.70 levels. The selling pressure was widespread wherein metal, realty and energy lost over 5% each. The broader indices extended their prevailing bias and lost in the range of 4%-5%.
It is a double whammy for participants as Nifty has slipped below its immediate support of short-term moving average i.e. 20 DEMA and also breached the trendline support while midcap and smallcap space are already under tremendous pressure. We suggest maintaining negative bias in the index now and utilizing rebound to create short positions. At the same time, traders shouldn’t add to their loss-making positions and prefer index majors over others.
Rupak De, Senior Technical Analyst, LKP Securities
The Nifty has experienced a breakdown from a rising channel on the daily chart, signaling the conclusion of the previous uptrend and the potential beginning of a downtrend. Additionally, the index has descended below the recent consolidation phase on the daily timeframe, further emphasizing the increasing weakness.
The Relative Strength Index (RSI) with a period of 14 is showing a bearish crossover and has dropped below the 50 mark.
In the short term, the index may continue to be susceptible to selling pressure with resistance anticipated around 22,250. On the downside, support levels are positioned at 21,800 and 21,700.
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