The benchmark stock market indices ended lower on May 25 for the third day in a row dragged by heavy selling pressure in IT and FMCG stocks. Indian indices opened higher on Wednesday but afterwards turned negative later in the day. Among the sectoral indices, Nifty IT, metal, media, pharma, PSU bank, and realty were the top losers. Bank Nifty gained 0.14 percent to end at 34,339.
The weakness in US stocks is playing out globally with signs of higher inflation, which has spoiled investors’ appetite for the Indian market as well. Rising VIX to 25.28 has led Indices to big intraday swings on both sides.
At close, the Sensex was down 303.35 points or 0.56 percent at 53,749.26. The broader Nifty was down 99.40 points or 0.62 percent at 16,025.80. About 696 shares have advanced, 2548 shares declined, and 109 shares are unchanged.
This is the third consecutive session of weakness in the markets. The Sensex had lost 236 points or 0.43 percent on Tuesday. The broader Nifty 50 of the National Stock Exchange was trading 37.85 points or 0.23 percent down at 16,087.30 points.
Asian Paints slumped 5.62 percent to Rs 2913. Power Grid Corporation, L&T, State Bank of India, Tata Steel, Mahindra & Mahindra and Maruti Suzuki were among the major Sensex losers.
There was good buying support in private banks. Kotak Bank surged 2.59 percent to Rs 1929.50. ICICI Bank rose 1.04 percent to Rs 715.45. HDFC Bank was trading 0.65 percent higher at Rs 1327.55. Nestle India, NTPC, HDFC, Bajaj Finance and ITC were among the major Sensex gainers.
Among top Nifty laggards were Asian Paints, Adani Ports, Divis Labs, UPL and TCS. Gainers included NTPC, HDFC Life, SBI Life Insurance, HDFC and Bharti Airtel.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd said, The subdued mood in the market continued for the third straight session as investors preferred to liquidate their holdings in stocks which are still highly valued. Investors are also waiting for the US FOMC minutes that will provide some clarity on where the market could move in the near-term.
Technically, on intraday charts, from the last three days the Nifty is holding lower top formation. And on daily charts, it has formed a bearish candle which is broadly negative. We are of the view that the short-term market structure is weak but it is in an oversold territory. For traders, now 16000 would act as a sacrosanct level. If the index succeeds to trade above the same, then it could move up to 16150-16260. However, below 16,000 the selling pressure is likely to increase. Below the same, the chances of hitting 15,900-15,850/53,300 would turn bright, said Chouhan.
Om Mehra, Research Associate, Choice Broking said, The OI Data, on the call side highest OI witnessed at 16,200 followed by 16,300 strike price while on the put side, the highest OI was at 15,800 strike price. Technically, Nifty has formed three black crow patterns in the daily chart suggesting bearishness would remain intact. We expect a rise in volatility as well on monthly expiry day. Riding against the trend may not be beneficial for short term traders. All major moving averages are lying above 16300 levels. Indicators such as MACD and RSI are still struggling to overcome the oversold zone in the daily time frame. Overall, Nifty is having support at 15800 mark while on the upside 16,300 may act as an immediate resistance for monthly expiry. While Banknifty has support around 33,500 while resistance is placed at 35,00 on the daily chart, Mehra said.
Rupee edges up 3 paise to close at 77.54 against US dollar
The rupee recovered 3 paise to settle at 77.54 (provisional) against the US currency in a restricted trade on Wednesday as interventions by banks supported the local unit while a stronger dollar in overseas markets restricted the gains.
At the interbank forex market, the rupee opened higher at 77.54 against the greenback and moved in a range of 77.44 to 77.57 in the day trade.
Jateen Trivedi, VP Research Analyst at LKP Securities told PTI, "Rupee traded with pendulum swing on a range fight between hedgers as participants from banks tried to support rupee whereas remittance takers of dollar equally bought keeping rupee ranged between 77.47-77.60. The US Fed statement minutes later in the night might give some trend to the USDINR pair in futures".
Foreign institutional investors were net sellers in the capital market on Tuesday as they offloaded shares worth Rs 2,393.45 crore, as per stock exchange data.
European shares bounce back
European shares eked out gains on Wednesday, lifted by resource-linked stocks and banks, with investors watching for updates from central banks on monetary policy tightening amid rising concerns of an economic slowdown. The pan-European STOXX 600 index rose 0.4 percent by 0832 GMT, paring some early gains as heavyweight technology and luxury names slipped.
(With inputs from Reuters, agencies)