Mid-day Mood | Bank Nifty in a free fall, slips 850 pts to below 44,800; Nifty, Sensex fall 0.8%

The Sensex and the Nifty 50 edged lower on February 12.

The benchmark Nifty 50 and Sensex traded lower in afternoon trade on February 12 amid lack of positive triggers and a slump in frontline banking stocks. Selling in a few heavyweight counters like Reliance Industries, ITC, ICICI Bank, and HDFC Bank too weighed on the benchmarks.

Losses in ICICI Bank, SBI, and HDFC Bank which fell 1-2 percent also weighed heavily on the Nifty Bank index, dragging it over 850 points or 2 percent lower to 44710.30.

State-run banks struggled with losses as investors chose to book profit from its recent run-up amid growing bullishness over public sector undertakings. The Nifty PSU Bank index was the worst hit among sectoral indices as it slumped 3 percent by mid-day on February 12.

Information technology stocks, however, bucked the overall weak market trend and logged in some gains. The Nifty IT index became the top sectoral gainer backed by positive cues from its Wall Street peers expectations of easing macro conditions as the US Federal Reserve moved closer to rate cuts and taming inflation. The sectoral index surged over 1 percent backed by 1-4 percent gains in Infosys, Wipro and HCLTech.

At 1 pm, the Sensex was down 575.33 points or 0.80 percent at 71,020.16, and the Nifty was down 178.60 points or 0.82 percent at 21,603.90. Losers heavily outnumbered gainers as about 822 shares gained, 2,544 lost, while 62 traded unchanged.

Selling pressure was more intense in the broader market with the BSE Smallcap as well as BSE Midcap indices shedding around 2 percent each.

"The fact that the markets are resilient even after the initial enthusiasm of early rate cuts in 2024, both in the US and in India, has moderated is an indication of the underlying strength in the market. Apart from positive economic cues, a major factor supporting the market is the sustained inflows from mutual funds," VK Vijayakumar, chief investment strategist, Geojit Financial Services.

Vijayakumar expects this to trigger buying on dips and hence the high market valuations are likely to be sustained for some time. "However, the frothy valuations of the broader market are a matter for concern. From the long-term perspective, safety is in large-caps," he added.

"The Nifty can find support at 21,700, followed by 21,650 and 21,600. On the higher side, 21,950 can be an immediate resistance, followed by 22,000 and 22,050," said Deven Mehata, research analyst at Choice Broking.

"The charts of Bank Nifty indicate that it may get support at 45,500, followed by 45,300 and 45,000. If the index advances, 45,850 would be the initial key resistance, followed by 46,000 and 46,150," Mehata added.

Wipro, HCLTech and Apollo Hospitals

HEro MotoCorp, Coal India, BPCL, NTPC, and ONGC

Wipro, HCLTech, and Infosys

NTPC, Tata Steel, and SBI

Bandhan Bank: Shares nosedived over 7 percent as around Rs 23,300 crore worth of loans lent by the lender under credit guarantee schemes is being reviewed by National Credit Guarantee Trustee Company (NCGTC) due to doubts of evergreening.

Hero MotoCorp: Shares slumped over 5 percent following bearish calls with subdued target prices by multiple brokerages, who say the stock is overvalued. Brokerage pessimism for the stock comes in despite the two-wheeler major posting better-than-expected earnings in the December quarter.

Honasa Consumer: Stock soared 10 percent after the company posted an over a three-fold jump in its Q3 net profit. The company's net profit zoomed three-fold from the previous year to Rs 26 crore in the December quarter while consolidated revenue was up 28 percent at Rs 488 crore.