Sensex below 60k, Nifty slips 100 pts; Adani Group stocks tank up to 18%, Tata Motors rises 8%

Domestic equity markets bucked the global trends and resumed the trading on Friday on a weaker note. The selling in Adani Group stocks and financials weighed on the market sentiments and pulled the indices sharply lower. The weakness in the broader space intensified as the session progressed.

Investors lost about Rs 3 lakh crore from their pockets during the first 30 mins of trading session, despite firm global cues led by US economic data. Analysts believe that markets are likely to remain volatile ahead of the budget.

As of 9.20 am, BSE Sensex plunged 381.4 or 0.63 per cent at 59,832.66. Nifty50 dropped 104 points or 0.58 per cent to 17,878.95 on Friday. However, broader markets outperformed the headline peers as BSE midcap and smallcap indices inched up marginally. Fear gauge India VIX spiked 8 per cent to 15.85-level.

In the first hour, the weakness looked routine but the moment negative news flow related to Adani group stocks started to make headline, the banking counters fell like a pack of cards. The development dampened the overall sentiments in the market and as a result, the Nifty tanked below important intraday supports, said Sameet Chavan, Chief Analyst- Technical and Derivatives, Angel One.

"Fortunately, the selling cooled off towards the latter part of the day and in the process, the sacrosanct support of 17,800-17,700 stays defended. We continue to remain hopeful as long as we maintain our position above this important support zone. On the flipside, 18,000 followed by 18,100 are to be seen as immediate hurdles," he said.

Sectoral trends remained largely mixed. Nifty auto index jumped 2 per cent, whereas pharma index was up by a per cent. Media, FMCG, IT and realty were other gainers. On the downside, banking index tumbled 2 per cent, whereas financials were also among the top laggards.

On the Nifty50 pack, Adani Ports and Adani Enterprises plunged 5 per cent each amid the negative reports on company's debt, triggered by Hindenburg's short position in the group. ICICI Bank, HDFC Bank, Axis Bank and HDFC weakened up to 3 per cent each.

On the contrary, Tata Motors surged 8 per cent as the company returned to black in December 2022 quarter. Bajaj Auto surged 6 per cent after reported a strong performance in the December 2022 quarter. M&M, Dr Reddy's Labs and Tata Steel were also up by 2 per cent each.

Data from the US indicates a resilient economy. With 2022 Q4 GDP growth at a better-than-expected and jobless claims falling, the hope for a soft landing for the US economy is increasing. Interestingly, this good economic news is now becoming good news for the market, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"There is a churn happening in the market now in favour of autos in response to good results from Tata Motors and Bajaj Auto. Adani stocks continue under pressure due to the fallout from the Hindenburg report. The elevated valuations of Adani stocks are a serious concern," he said.

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