Sensex, Nifty see profit-booking from record highs; auto, banking, IT shares lead losses

The record winning run in benchmark indices came to a halt on Wednesday led by a correction in auto (primarily M&M), banking, IT and metal stocks. Sensex ended 427 points lower at 79,924 and Nifty lost 109 points to 24,324 today. Earlier in the day, Sensex scaled a record high of 80,481 and Nifty reached its all-time peak of 24,461.

Market cap of BSE-listed firms fell to Rs 450.08 lakh crore.

M&M, Tata Steel, TCS, HCL Tech, SBI and JSW Steel were the top Sensex losers, falling up to 6.62 per cent. Of 30 Sensex stocks, 18 ended in red.

Meanwhile, shares of Asian Paints, PowerGrid, NTPC, HUL and Sun Pharma were the top Sensex gainers, rising up to 3.10%.

Shares of Mahindra & Mahindra (M&M) fell sharply after the carmaker announced a price cut for certain XUV700 variants. The stock tumbled 7.79 per cent to hit a day low of Rs 2,697.80. Later, the stock closed 6.62% lower at Rs 2732.10 on BSE.

Vinod Nair, Head of Research, Geojit Financial Services said, "The Indian market experienced profit booking ahead of the upcoming earnings season. The expectations are muted given moderation in sales growth due to a slowdown in the world economy and consolidation in margins driven by high inflation. Additionally, the market is under temporary risk towards high budget expectations, which appears well factored in the last one month's rally. Broader indices lagged large caps and FMCG sector, which are expected to drive momentum going ahead due to stable business outlook."

BSE auto and banking indices ended 971 pts and 387 pts lower, respectively. BSE IT and metal indices fell 380 points and 584 points. 

Market breadth was negative with 1363 stocks rising against 2576 stocks falling on BSE. 82 shares were unchanged.

Prashanth Tapse, Senior VP (Research), Mehta Equities said, “Market had been hitting new highs over the past few weeks and hence investors resorted to profit-taking because of the stretched valuations of Indian equities. While several sectoral stocks have run up sharply ahead of their fundamentals, the upcoming earnings of many of these companies will show if the rise is justified or not. Also, investors would look to churn their portfolios ahead of the Budget and trim their exposure in risky stocks.”

FII-DII data

Foreign institutional investors bought Rs 314 crore worth of equities on a net basis on Tuesday, while domestic investors bought Rs 1416 crore of shares, as per provisional NSE data.

Previous session

Sensex and Nifty ended at fresh record highs on Tuesday led by gains in auto and consumer durables sector stocks. Sensex gained 391 pts to 80,351 and Nifty rallied 112 pts to close at 24,433. Sensex hit a record high of 80,397 and Nifty scaled a high of 24,443 on Tuesday.