Benchmark indices ended lower for a second consecutive session on August 1, marking the fifth week of losses, with Nifty closing below 24,600 on the first day of the August series, as selling across sectors weighed on the sentiment, majorly in pharma names.
This has been the longest weekly losing streak in two years for Nifty 50.
Tracking weak global cues, the indices had opened lower but recovered, however, a mid-session profit booking and extended selloff in the final hour dragged Nifty below 24,550, ending near day's low. At close, the Sensex was down 585.67 points or 0.72 percent at 80,599.91, and the Nifty was down 203 points or 0.82 percent at 24,565.35. The broader indices underperformed, with BSE Midcap index down 1.3 percent and Smallcap index lower by 1.6 percent.
For the week, BSE Sensex and Nifty slipped by a percent each.
Also Read: Market activity slows sharply in July amid weak sentiment, regulatory curbs
The biggest Nifty losers were Sun Pharma, Dr Reddy's Labs, Adani Enterprises, Tata Steel, Cipla, while gainers included Trent, Asian Paints, Hero MotoCorp, HUL, Nestle. Except FMCG, all other sectoral indices ended in the red, with auto, realty, pharma, IT, metal, oil & gas, PSU Bank down up to 2 percent.
Read More: ITC Q1 Preview: Cigarettes may report stable volumes, profit growth likely flat
In stock-specific action, Maruti Suzuki shares slipped over 2% after Q1 results, Swiggy shares tanked 3% after weak Q1, and Neuland Labs' shares fell 3 percent after Q1 consolidated profit fell 85%.
Chalet Hotels shares slipped 2 percent despite a rise in consolidated profit, Suzlon Energy shares gained 7 percent on order, PNB Housing Finance shares shed 18% on MD and CEO's exit, and Niva Bupa Health shares fell 7 percent as Q1 losses widened.
More than 130 stocks touched their 52-week highs on the BSE, including Procter Gamble Health, Radico Khaitan, Star Cement, Hitachi Energy, eClerx Services, JK Cement, Schneider Infra, Fortis Healthcare, Bosch, Amber Enterprises, Chalet Hotels, Maharashtra Scooters, among others. Click to View More
Outlook for August 4
Rupak De, Senior Technical Analyst at LKP Securities
Nifty witnessed another sharp decline as it failed to reclaim the 200-DMA on the hourly chart, despite a strong recovery on Thursday. Throughout the day, the index remained below the 50-EMA on the hourly timeframe. On the daily chart, it has broken below the recent consolidation support at 24,600.
Sentiment remains weak, with the potential for the correction to extend towards 24,400–24,450. A further decline is likely if it slips below 24,400; otherwise, a recovery can be expected. On the higher side, resistance is seen at 24,600–24,650 and 24,850.
Ajit Mishra – SVP, Research, Religare Broking
Markets began the August series on a negative note, extending the prevailing corrective trend, and ended lower by over half a percent. The first half of the session remained range-bound, with Nifty oscillating in a narrow band. However, selling pressure in heavyweights during the final hours dragged the index below its medium-term moving average—the 100-day EMA—near the 24,600 mark, eventually settling at 24,565.35.
On the sectoral front, pharma, metal, and IT were among the top losers. The broader indices also witnessed sharp cuts, each losing nearly 1.5%, resulting in a significant decline in market breadth.
Markets continue to grapple with a mixed earnings season, while the recent tariff announcement and persistent foreign fund outflows are further weighing on sentiment.
Nifty is now approaching its next crucial support at 24,450; a breach of this level could trigger a retest of the long-term moving average, the 200-day EMA, near 24,180. On the upside, the 24,800–25,000 zone is expected to act as a strong hurdle. We maintain our cautious stance and continue to recommend a hedged approach with a negative bias until clear signs of reversal emerge.
Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities
After showing high volatility on Thursday, Nifty slipped into a sharp weakness amidst choppy movement on Friday and closed the day lower by 203 points.
A long negative candle was formed on the daily chart on Friday at the new swing lows beside the long bull candle of previous session. Technically, this market action is suggesting inherent weakness in the market to sustain the bounces.
Nifty is currently placed near the crucial support of around 24500 levels (multiple swing lows of May-June 25), but the sustainable recovery has not emerged from near the supports so far. Bearish lower highs and lower lows pattern is intact on the daily chart.
Nifty on the weekly chart formed a reasonable negative candle this week, which is for the fifth consecutive bearish candle formation on the trot. The previous sharp upside breakout of larger range movement of last month has been completely negated and the market slipped below the immediate support zone of 24600 mark.
The underlying trend of Nifty remains weak. A decisive move below the support of 24500, Nifty could slide down towards the next lower area of 24100-24000 levels in the near term. Immediate resistance is placed at 24950 levels.
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