Domestic equity market settled lower on Tuesday as the headline indices snapped the four-day winning streak amid the selling pressure in IT and financial counters. Weak global cues from China and other markets weighed on the market sentiments. Regulatory action in India also weighed on th select stocks.
For the day, BSE's Sesnex dropped 195.16 points, or 0.26 per cent, to settle at 73,677.13. NSE's Nifty50 index shed 49.30 points, or 0.22 per cent, to end the session 22,356.30. Broader markets were also week as the BSE midcap index eased 0.16 per cent, while the BSE smallcap index shed two-third a per cent. Fear gauge India VIX eased more than 3.6 per cent to 14.38-levels.
"Nifty traded in a small range and ended the day’s session below the previous day’s closing price. During the day, the benchmark index formed a bearish ‘hanging man’ candlestick pattern at almost another all-time high," said VLA Ambala, co-founder at Stock Market Today.
"After factoring in these aspects, the scope for metal, media, consumption, pharma, and private banks looks significantly bullish for the next trading session. However, sectors like FMCG and Realty may continue to display bearish momentum," she said.
On a sectoral front, the Nifty PSU Bank index surged 2.56 per cent, while the Nifty auto index was up 1.35 per cent for the day. Among the laggards, the Nifty IT index shed 1.6 per cent, whereas the Nifty media and FMCG indices declined more than 1 per cent each. The Nifty consumer durable index was down two-third a per cent.
In the Nifty50 pack, Bajaj Finserv and Bajaj Finance topped the laggards, with each falling more than 4 per cent. Nestle India and Infosys dropped more than 2 per cent each. Tata Consultancy Services, SBI Life and LTIMindTree were other key losers. Among the gainers, Tata Motors rose 3.6 per cent over demerger news, while Bharti Airtel gained 3.13 per cent. Bajaj Auto rose 1.75 per cent.
The domestic market experienced range bound movement post hitting new record high in the preceding day, influenced by cautious trend in global peers ahead of the Fed Chair's congressional testimony and key US jobs data. The absence of significant stimulus measures from China further dampened sentiment, said Vinod Nair, Head of Research, Geojit Financial Services.
"Mid and small-cap stocks continued to underperform due to their higher valuations. The IT sector sustained recent losses amid concerns over delays in rate cuts by the US Fed. However, PSU banks outperformed, while auto stocks gained momentum supported by healthy volume numbers and pick-up in rural demand," he said.
A total of 3,933 shares were traded on BSE on Tuesday, of which 2,574 settled with cuts. 1,267 stocks ended the session with gains while 92 shares remained unchanged. During the day, 256 shares hit their upper circuit, whereas 379 shares tested the lower circuit levels for the day.
Combination of weak global cues and persistent upsurge in past four trading sessions resulted in profit-taking as markets languished in negative territory for major part of trading session, sai Prashanth Tapse, Senior VP (Research), Mehta Equities "Buying in auto and banking stocks pared losses in a weak market," he said.
In the broader markets, IIFL Finance tanked 20 per cent after RBI's actions, while IIFL Securities and Yasho Industries dropped 13 per cent each. Data Patterns India declined 8 per cent, while RBL Bank, Allcargo Logisitics and Nelcast shed 6 per cent each. GTL Infra, Network 18 and Inox Wind hit lower circuit of 5 per cent each.
Among the gainers, Capri Global Capital hit an upper circuit of 20 per cent, while PNB Gilts and Indian Overseas Bank rose 10 per cent each. Astec Lifesciences, SMS Pharmaceuticals, Kirloskar Brothers and Balaji Amines rose 9 per cent each. Westlife Foodworks and Punjab & Sind Bank were up 8 per cent each for the day.