Nifty Retreats From Record To End Lower As HDFC Bank, ICICI Bank Drag: Market Wrap
The Nifty ended 0.20% lower at 22,597.80, and the S&P BSE Sensex closed 0.25% down at 74,482.78.
Indian benchmark stock indices erased all gains and ended lower on Tuesday as heavyweights HDFC Bank Ltd. and ICICI Bank Ltd. dragged. Decline in metal and information technology stocks also pressured the benchmarks.
The NSE Nifty 50 ended 45.60 points, or 0.20%, lower at 22,597.80, and the S&P BSE Sensex closed 188.50 points down, or 0.25%, at 74,482.78. Intraday, the Nifty rose 0.62% to a record high of 22,783.35 and the Sensex gained 0.59% to 75,111.39.
Market participants will monitor the policy decision from the US Federal Reserve, due to be published on Wednesday. The Fed fund future traders expect 97% possibility of a status quo, while the rest expect a cut of 25 basis points, according to CME FedWatch Tool.
"Nifty witnessed selling pressure as it encountered resistance near the previous swing high, resulting in a weak closing," said Rupak De, a senior technical analyst at LKP Securities Ltd.
Other indicators, such as the 20-day simple moving average and the 50-day SMA, are positioned below the index value, suggesting that the ongoing positive trend remains intact. The Relative Strength Index also indicates a bullish crossover. Over the next few days, the trend in the headline index might remain sideways, unless it breaks above the all-time high of 22,783. On the downside, immediate support is placed at 22,500, below which the index might decline further, De said.
"The Bank Nifty witnessed a volatile trading session during the expiry day, with bulls dominating the first half and bears taking control in the second half. Although the index fell short of reaching the 50,000 mark, the overall sentiment remains bullish," said Kunal Shah, senior technical and derivative analyst at LKP Securities.
Dips in the index should be seen as buying opportunities, especially with strong support noted around the 49,000-mark, where the highest open interest lies on the put side, said Shah.
Shares of Mahindra & Mahindra Ltd., Power Grid Corp. of India, Bajaj Finance Ltd., Bajaj Auto Ltd., and Shriram Finance Ltd. capped loss in the Nifty.
While those of HDFC Bank Ltd., ICICI Bank Ltd., Larsen & Toubro Ltd., Tata Consultancy Services Ltd., and Infosys Ltd. weighed the index down.
On NSE, seven out of 12 sectors declined, and five advanced. The NSE Nifty IT was the top loser, and NSE Nifty Auto was the top gainer.
Among the sectors, auto was the top gainer of the day, followed by realty and on the flip side, IT extended its southward journey while metal segment witnessed a round of profit-booking, said Aditya Gaggar, director, Progressive Share Broker Pvt.
"At record levels, the index has made a bearish candle with a probable divergence in the RSI (not yet confirmed)," said Gaggar.
Broader markets outperformed the benchmarks. The S&P BSE Midcap settled 0.49% up, and the S&P BSE Smallcap ended 0.10% higher.
On BSE, eight sectors advanced and 12 declined. The S&P BSE Auto was the top gainer, while the S&P BSE Information Technology was the worst performer.
Market breadth was skewed in the favour of sellers. Around 1,989 stocks declined, 1,832 rose, and 129 stocks remained unchanged on the BSE.
