Nifty, Sensex fall over 1%; here's what dragged indices today

So far in February, Sensex and Nifty have risen 1.1 percent and 1.3 percent, respectively.

Benchmark indices fell over 1 percent on February 28 due to a heavy sell-off seen in media, PSU bank, and energy stocks. According to analysts, domestic equities are consolidating in a range with every dip being bought showing strength at lower levels. Investors now await India's GDP growth data.

The Sensex closed 790.34 points or 1.08 percent down at 72,304, and the Nifty fell 247.10 points or 1.11 percent to 21,951. About 668 shares advanced, 2,626 declined, and 62 remained unchanged. So far in February, Sensex and Nifty have risen 1.1 percent and 1.3 percent, respectively.

1. Rout in Mid-, Small-caps

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2. Media, Realty stocks bleed

Sectorally, all NSE indices were trading in the red, with losses led by Nifty Media, Realty, PSU Bank and Energy indices which fell over two percent. Nifty Bank, Metal, and Infra also fell over one percent.

3. FIIs selling intensifies

FIIs selling off substantial amounts of Indian stocks may have likely contributed to the market's fall FII has continued to be a net seller, with month-to-date (MTD) net sales of Rs 17,650 crore.

4. Key Economic data

Ahead of important Indian GDP data and US economic data, including the second estimate of GDP, PCE, and manufacturing statistics, global markets have been struggling for direction as investors remain cautious.

“The market also became nervous before so many economic indicators such as GDP data, PCE price index data, and manufacturing PMI numbers in the US. Another reason may be that the US government will partially shut down on March 1st without a spending bill," said Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd.

5. Profit-booking

Indian markets were jittery mirroring weak global markets. Turmoil in China's property sector further impacted the Asian market trend. "Profit booking weighed on Indian markets, fuelled by concerns about India's Q3 GDP growth potentially slowing to 6.6 percent from 7.6 percent in Q2. Rate-sensitive sectors faced pressure, contributing to broader market underperformance, led by FIIs selling," said Vinod Nair, Head of Research, Geojit Financial Services.

Fundamental view

"Market is likely to be in a range-bound zone in the near term in the absence of strong positive or negative triggers. The market resilience will be supported by strong stocks like RIL, Bharti, and auto stocks particularly Tata Motors, M&M and Bajaj Auto which have emerged as strong leaders in this phase of the market," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Technical view

"Nifty managed to close just above the 21EMA on the daily timeframe. Observing the daily chart, the index has been navigating within a rising channel. A decline below 21,950 could potentially trigger a correction towards 21,800 in the near term. Conversely, a sustained trade above 21,950 might spur a recovery in the index towards 22,100," said Rupak De, Senior Technical Analyst, LKP Securities.

Meanwhile, the selling pressure pushed the Bank Nifty index below the crucial short-term moving average. "The sentiment appears negative, with the index potentially moving towards 45,700-45,300 in the near term. Resistance is positioned at 46,100," Rupak De added.

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