Nifty tanks almost 1% on F&O expiry; Auto, IT stocks drag

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Domestic indices BSE Sensex and NSE Nifty50 extended losses on September 28, as rising crude prices and US Treasury yields dampened the investor sentiment since morning. IT stocks traded with sharp cuts, dragging the benchmarks and broader markets.

At 2.50 pm, the 30-share BSE Sensex traded firmly below the key 66,000 level, down 574.75 points or 0.87 percent. The NSE Nifty50 was down 184.00 points or 0.93 percent at 19,532.50. About 1,333 shares advanced, 1,769 shares declined, and 93 shares unchanged.

The broader markets traded in the red, with Nifty Next 50 and Nifty Midcap 100 tanking over 1%. The fear gauge, India VIX, jumped 10.2% amid the negative market sentiment.

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"Even though the market shows resilience, the undercurrent is weak. The dollar index at 106.59, the US 10-year bond yield at 4.62 percent and Brent crude above $97 are strong headwinds that can pull the market further down. The FIIs, who have sold equities worth Rs 21,640 crore so far in September, are likely to sell more,” said VK Vijayakumar, chief investment strategist at Geojit Financial Services.

He added that investors should exercise caution, advising traders to book profits on midcap and smallcap stocks that have gained on aggressive buying and general market exuberance. There is safety in largecaps, he said, particularly in segments such as banking/financials, capital goods and autos.

Stocks and sectors

Shares of L&T were in focus, jumping almost 3 percent to hit a fresh record high of Rs 3,050.50, ahead of the company’s bid settlement for its buyback later on September 28. The firm will also return all the unaccepted shares and pay the consideration to all the shareholders who participated in the buyback and were deemed eligible. UBS raised its target price on L&T to Rs 3,600 from Rs 3,040 per share, as the brokerage house believed the firm's new strategy ensures consistent new order growth and expansion in international markets.

The JSW Steel stock price gained around 1 percent following its acquisition of a 50 percent stake in NSL Green Steel Recycling.

Among the laggards, Vodafone Idea shares slumped around 3 percent to Rs 11.5 after lacklustre monthly subscription data from TRAI showed the telecom player lost 13.2 lakh subscribers in July.

Power Finance Corporation was down by over 2 percent after it transferred subsidiaries Ananthpuram Kurnool Transmission Limited and Bhadla III Transmission Limited to Power Grid Corporation of India.

Sectorally, all indices were deep in the red. As IT stocks dragged the markets, Nifty IT slipped almost 2%; TechM, LTIMindtree and Mphasis were the top losers as of 2.55 pm. Realty, metal, media, FMCG and auto indices fell more than 1% each.

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