Market Update: Sensex, Nifty retreat from highs as markets log first drop in 7 days

In its first drop in seven days, the benchmark Bombay Stock Exchange (BSE) Sensex on Wednesday retreated from record highs and ended 106 points down at 26,314.29 as investors booked gains in oil and gas, FMCG and capital goods scrips amid mixed global cues.

Losses in counters like ONGC, GAIL, RIL, SBI, Axis Bank, Mahindra and Mahindra, Maruti Suzuki, ITC and Larsen & Toubro mainly weighed on the market sentiment.

Bucking the general weak trend, pharma sector stocks such as Dr Reddy's Lab, Ranbaxy, Cipla and Sun Pharma ended higher - providing investors some relief.

The Sensex ended down 106.38 points, or 0.40 per cent, to end at 26,314.29 after surging to 26,504.52 intra-day.

On Tuesday, the 30-share benchmark had ended at its all-time closing high of 26,420.67 and had also logged intra-day life high of 26,530.67. In previous six days of straight gains, it had gained over 1,091 points.

The National Stock Exchange (NSE) Nifty in early trade hit a new high of 7,922.70 but slipped below the 7,900-mark to close at 7,875.30, down 22.20 points or 0.28 per cent.

Its earlier all-time closing high was 7,897.50. On Tuesday, it had touched intra-day record high of 7,918.55. In previous six days, it rose 329 points.

"Investors booked profits after the recent surge which saw them reach record high levels. Buying interest was seen in IT and pharma stocks on account of a weak rupee against the dollar," said Rakesh Goyal, Senior Vice President, Bonanza Portfolio.

Sectorwise, the BSE Oil and gas index suffered the most by falling 1.32 per cent, followed by FMCG Index 0.70 per cent and Auto Index 0.56 per cent.

However, Healthcare index ended 2.93 per cent higher, Power index 0.73 per cent, Realty index 0.52 per cent and IT index 0.23 per cent.

Meanwhile, Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 559.39 crore on Tuesday, as per provisional data from the stock exchanges.

In Asia, most indices edged higher following a positive lead from Wall Street, where stocks picked up on encouraging US data before a keynote speech this week by Federal Reserve chief.

However, Europe's main stock markets dipped at the start of trading on Wednesday after two days of strong gains.

London's benchmark FTSE 100 index fell 0.12 per cent and Frankfurt's DAX 30 edged down 0.05 per cent. The CAC 40 index in Paris also lost 0.10 per cent.

Foreign Portfolio Investors (FPIs) put in Rs 559.35 crore on Tuesday as per provisional data.

Talking about today's dip, Jignesh Chaudhary, Head Of Research, Veracity Broking Services, said: "Local indices closed weak on profit booking after logging record highs for successive sessions. Investors are trading cautiously ahead of the Fed minutes later today as it may indicate when policymakers plan to raise US interest rates."

Barring China that finished lower by 0.23 per cent, other Asian stocks closed higher after strong US housing data lifted US stocks. Key benchmark indices in Hong Kong, Japan, Singapore, South Korea and Taiwan ended up between 0.03 per cent and 0.48 per cent.

European markets were quoting lower in their morning deals after minutes of Bank of England's latest polity meeting showed two external members voted for interest-rate hike, said fund managers.

Back home, 19 shares in the 30-pack Sensex finished in the red while others ended in the green. Major losers include ONGC 2.62 per cent, Tata Motors 1.37 per cent, M&M 1.21 per cent, HDFC 1.19 per cent, ITC 1.12 per cent, SBI 1.10 per cent, RIL 1.04 per cent and HUL 1.00 per cent.

Axis Bank 0.92 per cent and Bharti Airtel 0.91 per cent also logged losses.

Besides pharma stocks, other major gainers included Tata Power 1.73 per cent, BHEL 1.47 per cent and NTPC 1.08 per cent.

In the S&P BSE sectoral indices, Oil and Gas dipped by 1.32 per cent, FMCG 0.70 per cent, Auto 0.56 per cent and Capital Goods 0.51 per cent while Healthcare firmed up by 2.93 per cent, Power 0.73 per cent and Realty 0.52 per cent.

Overall market breadth in BSE remained strong as 1,692 stocks concluded with gains while 1,285 closed with losses.

Total equity turnover was slightly lower at Rs 3,125.21 crore from Rs 3,140.59 crore on Tuesday.