Sensex, Nifty fall in early trade; Nestle India shares drop 3%; Minda Corp, Pricol rally up to 5%

Domestic equity markets opened lower on Friday, tracking the negative global cues. Inflation data in the US lifted the hopes that the US Federal Reserve is likely to remain hawkish and will keep the interest rates higher to tackle the sticky rising prices. At 9.20 am, the 30-share pack BSE Sensex was trading 267.52 points, or 0.44 per cent, lower at 61,051.99. NSE's Nifty50 shed 70.30 points, or 0.39 per cent, to 17,965.55. Broader markets were mixed as BSE midcap index was down slightly, whereas smallcap index rose marginally. Fear gauge India VIX eased about a per cent to 12.80-level. The daily price action formed a small bear candle carrying higher high-low, indicating a continuance of upward momentum. In the process, the broader market outperformed as Nifty midcap and smallcap gained over 0.8 per cent. Thus, a temporary dip from here on should be capitalised on as an incremental buying opportunity, said ICICIDirect Research. "The follow-through strength above the falling channel breakout signifies inherent strength that makes us believe the index will resolve higher and gradually head towards 18,300 in coming weeks as it is 61.8 per cent retracement of the entire correction since January 2023. Meanwhile, bouts of volatility tracking global cues cannot be ruled out," it said. Barring media and metal indices, all other sectors of Nifty were trading in the red. IT index dropped more than a per cent, followed by PSU bank index. Private Bank, Financial Services and Pharma index were also down half-a-per cent, each. In the Nifty50 pack, Nestle India tanked over 3 per cent after its quarterly results failed to boost investors' morale. IndusInd Bank dropped 2 per cent. IT indices including HCL Technologies, Tech Mahindra, Wipro and Tata Consultancy Services dropped over a per cent each. Among the gainers, UltraTech Cement rose about 2 per cent. UPL, Grasim, Bharat Petroleum and Hero Motocorp gained about a per cent each in the early trade. Adani Group stocks will remain in the focus of traders as the hearing over the Hindenburg saga continues in the Supreme Court. Adani Enterprises edged lower but Adani Ports, Ambuja Cements and ACC gained a per cent, each, in the early trade. Adani Power and Adani Wilmar hit an upper circuit of 5 per cent, each, whereas Adani Green and NDTV jumped 4 per cent, each, in the early hours. On the other hand, pain continued in Adani Total Gas and Adani Transmission as both stocks were locked in the seller's circuit of 5 per cent, each. There is a clear pattern to the trends from the US. Whenever positive news like declining inflation comes, equity markets rise on hopes of a Fed pause and a possible rate cut by the end of 2023. Conversely, whenever data indicates a robust US economy, tight labour market and very slow disinflation, equity markets fall expecting the Fed to remain hawkish, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services. "This see-saw game is likely to continue till clarity emerges on where the economy is headed. Nifty is likely to remain in the range 17,800-18,200. As of now, there are no triggers to break this range in both directions. FIIs have sold in the cash market yesterday for Rs 730 crores indicating that they will continue to sell at higher levels," he said. Angel One dropped more than 2 per cent in the early trader after Narayan Gangadhar resigned from his post of Chief Executive Officer (CEO) of the company. On the contrary, Railtel Corporation of India surged more than 2 per cent after the company bagged an order from Bangalore Metro Rail Corporation. Pricol rose about 5 per cent in the early trade, before trading flat, as the company clarified its stake to Minda Corporation. However, the company denied their media reports. Shares of Minda Corporation also gained more than 3 per cent at the opening tick. In the broader markets, EKI Energy Services jumped about 8 per cent after hitting lower circuits for five sessions. Zentech Technologies and Supriya Lifesciences gained 7 per cent, each. On the contrary, Sadbhav Engineering and Sintex Plastics plunged 5 per cent, each.