The Indian market ended lower after a volatile session on June 29, a day ahead of the monthly expiry with investors also nervous about monthly auto numbers and PMI data to be released later in the week.
At close, the 30-pack Sensex lost 0.25 percent, or 134.31 points, to end the day at 53,027, while the broad-based Nifty ended lower by 32.95 points, or 0.21 percent, at 15,799.
“Consumer confidence is declining rapidly due to the uncontrolled and constant rise in inflation as India had to bear the double whammy effect of a dampening global equity market and rising crude prices as major suppliers like Saudi are unable to boost the output in the short-term”, said Vinod Nair, Head of Research at Geojit Financial Services.
The domestic market, however, was able to recover most of the losses due to a strong movement in index heavyweights, PSUs, metals and oil & gas stocks before squandering some of the gains at the end of the day due to a volatile global market, he said.
After opening weak, the market remained in the negative territory for the most part of the day but buying in energy and infrastructure stocks helped the indices to recoup losses after lunch.
The indices were in the green for a brief period before selling pressure returned amid volatility fuelled by weak European markets. The stocks gave up the gains and the market closed lower.
“June series witnessed significant volatility and continues to trade with a negative bias below 15,930”, said Sahaj Agrawal, Head of Research–Derivatives at Kotak Securities.
Volumes on the NSE were the highest since June 17. Despite the fall, Indian markets were among the best performers in the Asian region.
Stocks and Sectors
All the sectors remained volatile, swinging between positive and negative zones. Metals gained 0.24 percent, realty 0.22 percent and autos were up 0.15 percent ahead of expected good sales numbers for June. Automakers are expected to start sharing the numbers from July 1.
IT and FMCG sectors were the biggest losers, ending 1.3 percent down. Banking and finance stocks also lost close to a percent.
The broader markets too traded negative, with the BSE midcap losing 0.7 percent and the BSE smallcap index 0.18 percent
The India VIX, which indicates the degree of volatility traders expect over the next 30 days, increased 2.09 percent from 21.45 to 21.90.
The top losing stocks of the day were HDFC Life, Hindustan Unilever, Apollo Hospital, Axis Bank and Tata Consumer Products, ending 2.3 to 4.36 percent lower.
Among the top gainers were ONGC, NTPC, Reliance Industries, Coal India and Sun Pharma, with each adding between 1.2 and 3.2 percent.
Later afternoon, the cabinet approved a proposal that will allow upstream oil companies to sell crude oil to any firm in the domestic market. This move will lead to pricing and marketing freedom in the sector and boost production, which will ONGC and Reliance make healthy gains.
Among specific stocks, a short build-up was seen in Escorts, Max Financial Services and RBL Bank, while a long build-up was visible in Bosch Ltd, Abbot India and Trent Limited.
Of the 3,450 stocks traded on the BSE, 1,521 advanced, 1,782 declined and 147 stocks remained unchanged.
Outlook for June 30
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd
Selling pressure intensified in late trades as investors dumped banking, telecom and IT stocks, which dragged the Sensex below the psychologically vital 53,000 mark. With fundamentals remaining weak, the upward bias is unlikely to sustain for long.
As the European markets faltered in their morning trade, the modest gains got erased in late selling pressure. With crude rising once again and the rupee continuing to struggle against the dollar, investors are playing safe and trimming their exposure to equities at regular intervals.
Technically, the Nifty is consistently taking support near 15,700 and at the same time, witnessed profit-booking near the resistance level of 15,900.
We are of the view that 15,700 will act as a sacrosanct support zone and above it, the index can move to 15,900. Further upside can lift the index to 15,975. If the index trades below 15700, it can slide to 15,600-15,550.
Ajit Mishra, VP-Research, Religare Broking Ltd
Markets will react to the US GDP data in early trade and then the focus will shift to monthly derivatives expiry. While the Nifty has been hovering around its crucial hurdle of 15,900, the recent decline in the banking index is pointing towards more pain. Participants should maintain caution and focus more on overnight risk management.
Deepak Jasani, Head of Retail Research, HDFC Securities
Global stock markets slipped for the second straight day on growing fears that policymakers bent on dampening inflation will tip their economies into recession.
The Nifty has shown signs of rising from the opening low levels over the past few sessions but is not able to build on the gains. The index can remain in the 15,638-15,927 band over the next few sessions.
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