Updated on: Wednesday, October 20, 2021, 04:37 PM IST

Profit-taking intensifies on D-Street as auto, realty, pharma stocks take heavy pounding

Rallying for the fifth straight session on Wednesday, the 30-share BSE benchmark jumped 376.44 points to its all-time high of 60,660.75. | File pic

Rallying for the fifth straight session on Wednesday, the 30-share BSE benchmark jumped 376.44 points to its all-time high of 60,660.75. | File pic


The benchmark indices extended its downward rally and were trading near day's low as heavy selling was seen in realty and metal stocks on October 20. At close, the Sensex was down 456.09 points or 0.74 percent at 61,259.96. The broader Nifty50 was down 152.20 points or 0.83 percent at 18,266.60. About 877 shares have advanced, 2351 shares declined, and 115 shares are unchanged.

Hindalco, Titan Company, HUL, BPCL and Bajaj Finserv were among the major Nifty losers. Gainers included Bharti Airtel, SBI, Tata Motors, IndusInd Bank and Axis Bank.

Gaurav Udani, CEO & Founder, ThincRedBlu Securities, said, "Since the last two trading sessions Nifty has been making lower highs and lower lows, which indicates the correction in Nifty may continue for the next few trading sessions. Nifty closed at 18,280 , down by 130 points . Nifty may test 18,250 and 18,150 in the next few sessions. Traders in long position are advised to keep strict stoploss and book profits on every rise," he added.

Mohit Nigam, Head - PMS, Hem Securities said, "The selloff was more significant in the broader market space where the SmallCap and MidCap index dropped over 2.5 per cent. Other than telecom, all other indices are in the negative zone. Among individual stocks, Jubilant Food Works plunged nearly 9 percent after the company's same-store-sales growth came in at 26.3 percent for the July-Sept quarter which was lower than street estimation. Indian Railway Catering and Tourism Corporation (IRCTC) slipped 18 percent intra-day, amid heavy volumes, falling over 30 percent in the past two trading days on account of profit booking amid buzz that the government is appointing a regulator for the rail sector.

"Benchmark indices witnessed sell-off for a second consecutive session. We believe the profit-booking which was witnessed today is healthy for the market and any significant dip is a good opportunity to accumulate quality stocks. Immediate support for Nifty 50 is 18,100," Nigam added.

Palak Kothari, Research Associate, Choice Broking said, "On the technical front, the index has confirmed the bearish engulfing candle pattern which points out weakness in the counter for the upcoming session. On a daily chart, the stock has been trading with a support of 9 Days Moving Average, which suggests sustained above the same can continue the uptrend. In addition, a momentum indicator RSI slipped from an overbought zone & Stochastic has suggested negative crossover. At present, the Index has immediate support at the 18200 level, while an upside resistance is intact at 18,600 levels."

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd, said, "Market sentiment was weak throughout the trading session on the back of heightened profit-taking by investors in stocks that had rallied sharply in recent sessions. After a muted opening, benchmark Nifty broke the 18400 intraday support level and thereafter maintained a negative stance throughout the day. In the last two days the Nifty corrected nearly 400 points and currently it is trading near the important retracement support level.

"We are of the view that the index has completed one leg of correction, and 18,150 and 18,200 could act as sacrosanct support levels for the traders. Above the same there is a strong possibility of a quick pullback rally up to 18,350-18,425 levels. On the flip side, dismissal of 18,150 could increase further intraday weakness up to 18,080."

Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities, said, "Nifty remains in medium-term uptrend with 18,700/18,900 expected on the higher side. The midcap space is showing early signs of weakness on a broader level."

Deepak Jasani, Head-Retail Research, HDFC Securities, said, "The Nifty closed at almost the intra day low for the second session and advance decline ratio continued to be sharply negative. 18,198 and 17,948 are the two successive supports for the Nifty while, 18,351 could be a resistance for the near term. Post one or two days of more weakness, one may get a chance to bottom fish (especially for traders)."

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Published on: Wednesday, October 20, 2021, 03:49 PM IST