Sensex, Nifty Snap Six-Day Rally Ahead Of Fed Minutes: Market Wrap
The Sensex closed 0.59% lower at 72,623.09, while the Nifty declined 0.64% to end at 22,055.05.
The benchmark stock indices erased early gains and declined sharply to snap a six-session rally on Wednesday, ahead of the announcement of minutes of the U.S. Federal Reserve meeting.
The S&P BSE Sensex closed 434.31 points, or 0.59%, lower at 72,623.09, while the NSE Nifty 50 declined 141.90 points, or 0.64%, to end at 22,055.05.
During the day, the Sensex fell as much as 0.83% to 72,450.56, while the Nifty declined 0.90% to 21,997.95.
The Indian market is facing stiff resistance at higher levels, according to Vinod Nair, head of research at Geojit Financial Services. "The valuation of a broader index is at a significant premium, leading to an unfavourable risk-reward, which influences investors to book profits."
For day traders now, 22,150/73,000 would act as a crucial resistance zone. As long as the market is trading below the same, the weak sentiment is likely to continue, according to Shrikant Chouhan, head of equity research at Kotak Securities.
Shares of HDFC Bank Ltd., Infosys Ltd., Larsen & Toubro Ltd., NTPC Ltd., and Tata Consultancy Services Ltd. weighed on the Nifty 50 the most.
State Bank of India, Tata Steel Ltd., ICICI Bank Ltd., IndusInd Bank Ltd., and JSW Steel Ltd. led the gains.
Nine out of the 12 sectors on the NSE ended in the red. The Nifty Media declined the most as Zee Entertainment Enterprises Ltd. weighed on the index. The Nifty Energy and IT indexes also fell over 1% each.
The broader markets underperformed as the BSE MidCap fell 1.27% and the SmallCap declined 0.84%. Nineteen out of the 20 sectors on BSE Ltd. declined.
The market breadth was skewed in favour of the sellers as 2,365 stocks advanced, 1,477 declined and 100 remained unchanged on the BSE.
The global markets tread cautiously, awaiting the minutes of the U.S. Federal Reserve meeting, while Chinese markets were buoyed by policy interventions, Nair said. "Concerns lingered since investors were heavily betting on a U.S. Fed rate cut, which is put at risk by January's higher-than-expected inflation."
