Bears Tighten Grip; Sensex, Nifty Down 1% On FII Selling
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The bear operators tightened their grip on the bourses as the benchmark S&P BSE Sensex and the CNX Nifty broke their long-term important 200-days SMA support level and ended down by one per cent each to more-than a fresh 3-1/2-month low on lingeries worries over the tax issue amid disappointing Q4 earnings and sustained capital outflows.
Lack of major trigger from overseas markets also weighed on the market as Asian stocks closed mixed and European markets were trading lower on concern over a lack of progress in talks between debt-strapped Greece and its international creditors.
The market closed in negative terrain eight out of ten straight trading sessions and wiped out a total Rs 7.73 lakh crore investors' wealth since April 15, 2015.
Bears took full control over the bulls as all 12 sectoral indices closed in the red between 0.08 pct and 3.96 pct with realty, healthcare, Oil&Gas, consumer durable, FMCG, Bankex and CG taking the lead in the downslide.
The market was already under pressure after Indian Met Department (IMD) forecast below-normal monsoon this year which will affect the rain-dependent Indian economy considering the huge rural population relying on it for a living.
The monsoon will also determine country's inflation path and affect the central bank's decision on interest rate cycle.
The BSE 30-share indicator on the onset of business touched a high of 27,567.28 on better Asian cues on the back of more stimulus from Bejing and firm closing on Wall Street last Friday.
However, it met with strong resistance and fell back to a low of 27,141.55 before settling at 27,176.99 --lowest closing since January 7, 2015 when it had closed at 26,908.82 --, showing a fall of 260.95 points or 0.95 pct.
The 50-issue CNX Nifty of the NSE also tumbled by 91.45 points or 1.10 pct to a fresh more-than 3-1/2-month low of 8,213.80.
Mr. Jignesh Chaudhary, Head of Research, Veracity Broking Services said," Today local equities lost over one pct. Blue chips continued to slip down on ongoing worries about retrospective taxes and also the lower than expected first quarter earnings so far kept the investors away from the market."
Meanwhile, Foreign portfolio investors sold shares worth Rs 775.46 crore last Friday, as per provisional data.
Key US Federal Open Market Committee (FOMC) two-day polity meeting starting tomorrow and April derivative contract expiring this week also led to a cautions approach.
The broader market segment underperformed the Sensex with midcap and smallcap indices dropping by 2.1 pct and 2.85 pct respectively.
On the Sensex front, 23 scrips closed with losses while six others finished with gains and HDFC Bank held stable.
Major losers were Bharti Airtel (3.11 pct), SBI (3.08 pct), Dr Reddy's Lab (3.01 pct), BHEL (2.87 pct), HDFC (2.64 pct), HUL (2.48 pct), Sun Phrma (2.22 pct), Gail (2.10 pct), ONGC (2.03 pct), Icici Bank (1.85 pct), Cipla (1.48 pct), NTPC (1.27 pct) and Hero Motocorp (1.21 pct).
However, Maruti Suzuki rose by 3.02 pct on excellent Q4 earnings followed by SSLT 2.37 pct, Wipro 1.91 pct and Coal India 0.41 pct.
Among the S&P BSE sectoral indices Realty dropped by 3.96 pct followed by HC 3.21 pct, Oil&Gas 2.48 pct, CD 2.17 pct, FMCG 1.73 pct and Bankex 1.33 pct, Power 1.27 pct and CG 1.25 pct.
The market breadth remained negative as 2,063 counters ended in the red, while 664 settled in the green and 87 held stable. The total turnover fell to Rs 3,199.17 crs from Rs 3,663.64 crs on last Friday.