Sensex slips 110 pts; Nifty holds 22,450; Tata Consumer up 4%, ABFRL jumps 12%

Domestic equity markets settled slightly lower on Tuesday after a choppy trading session. Headline indices await RBI's monetary policy due later this week for India's roadmap of rate cuts. However, broader markets continued to outperform the headline indices but valuations concerns kept the traders on tenterhooks.

For the day, the 30-share pack BSE Sensex declined 110.64 points, or 0.15 per cent to settle at 73,903.91. NSE's Nifty50 index shed 8.70 points, or 0.04 per cent, to end at 22,453.30. Broader markets outperformed as the BSE midcap and smallcap index rose more than a per cent each. Fear gauge India VIX dropped more than 3.55 per cent to 11.65-level.

Markets witnessed select profit taking in banking and IT stocks as caution prevailed throughout the session ahead of the RBI monetary policy decision on Friday. Rising US bond yields have led to FIIs fleeing Indian equities in recent sessions, said Prashanth Tapse, Senior VP (Research), Mehta Equities.

"However, we are seeing renewed optimism in the broader market in the mid & small cap stocks after the sharp correction over the past few months. There is a lot of money waiting on the sidelines to be invested in medium enterprises amid easing valuations and hopes of strong economic growth going ahead," he said.

On a sectoral front, the Nifty consumer durable and media indices gained 1,85 per cent each, while the Nifty metal index rose 1.5 per cent. The Nifty oil & gas, realty and auto indices gained more than 1 per cent each for the day. Among the laggards, the Nifty IT index shed 0.7 per cent, while financial services, pharma, private banks and healthcare indices also ended in red.

In the Nifty50 pack, Hero MotoCorp declined about 2.5 per cent, while Kotak Mahindra Bank was down 2 per cent for the day. HCL Tech and ICICI Bank slipped over 1.5 per cent each. Among the gainers, Tata Consumer Product rose over 4 per cent, while Mahindra & Mahindra rose 3 per cent for the day. Bharat Petroleum and Bajaj Auto rose more than 2.5 per cent each.

The domestic market took a breather today after achieving new highs yesterday. Factors such as a rising dollar, increasing US bond yields, and a notable uptick in crude oil prices collectively dampened investor sentiment. Strong US manufacturing data raised worries about a potential delay in interest rate cuts, said Vinod Nair, Head of Research, Geojit Financial Services.

"Despite these factors, mid and small-cap stocks continued their recovery rally, although concerns about high valuations lingered. Investors are eagerly anticipating guidance from the upcoming RBI monetary policy announcement for insight into near-term market direction," he said.

A total of 3,959 shares were traded on BSE on Tuesday, of which 2,848 settled with gains. 1,003 stocks ended the session with cuts while 108 shares remained unchanged. During the day, 603 shares hit their upper circuit, whereas 148 shares tested the lower circuit levels for the day.

In the broader markets, Best Agro surged more than 19 per cent, while EKI Green Energy gained about 16 per cent. Sigachi Industries rose 13 per cent, while Aditya Birla Fashion & Retail rose 12 per cent. Tanla Platforms, Yasho Chemicals and Aditya Birla Capital advanced 11 per cent each for the day.

Among the laggards, Anand Rathi Wealth tumbled more than 5 per cent, while Ashapura Minechem, Subros and Zaggle Prepaid Ocean Services shed about 5 per cent each. Caplin Point, Jai Balaji Industries, Vodafone India and eMudhra tumbled more than 4 per cent each.