Benchmark indices closed in the red after volatility on first day of June series Friday as all sectoral indices were in the red barring Auto that outperformed all post May sales data. Continuous correction in midcaps dampened investors sentiment, which led to profit booking after more than 400 points rally on the Sensex in previous session.
Investors after digesting better-than-expected Q4 GDP data shifted focus to renewed global trade tensions after the US announced tariffs on steel and aluminium imports. They also closely monitor the movement in crude oil prices and rupee.
The 30-share BSE Sensex fell 95.12 points to 35,227.26 while the 50-share NSE Nifty closed below 10,700 levels, slipping 40 points to 10,696.20 ahead of monetary policy committee meeting next week.
Overall the market has been consolidating in a range, which may continue further and the stock specific action is likely to remain, experts said.
“We’re seeing only handful of stocks holding the Nifty while others are struggling in a range or inching lower. Stock selection becomes very difficult in such scenario,” Jayant Manglik, President, Religare Broking said.
He advises keeping proactive approach and prefers only fundamentally sound counters for trading. He expects further consolidation in Nifty within 10,550-10,850 zone in near term.
For the week, the Sensex and Nifty gained a percent each while Midcap index lost over a percent.
The broader markets continued to underperform frontliners with the Nifty Midcap index falling 267 points on weak breadth. About three shares declined for every share rising on the NSE.
All sectoral indices ended lower barring Auto that gained 0.8 percent after strong auto sales data for the month of May 2018. Bank, FMCG, IT, Metal and Realty indices were down up to 1.25 percent.
Bajaj Auto was biggest gainer among Nifty50 stocks rising 5 percent followed by Maruti Suzuki (up 3.2 percent), Tata Motors (1.66 percent) and Hero MotoCorp (2.3 percent) whereas Eicher Motors and M&M lost 2-3 percent post May sales data.
IT stocks – Infosys (down 0.9 percent) and TCS (down 0.5 percent) – were under pressure as the rupee hit fresh 3-week high of 67 against the US dollar intraday. The rupee appreciated 35 paise to 67.06 against the US dollar.
HDFC Bank fell 1.35 percent as exchanges did not get FPI (foreign portfolio investor) limit data from NSDL. The stock had rallied 4.5 percent in previous session ahead of opening of FII trading window on June 1.
ONGC stock dipped 2.6 percent as the state-run oil producer may bear fuel subsidy burden. Cash-strapped Venezuela stopped payments of oil dues to ONGC Videsh also weighed on.
ICICI Bank trimmed gains to 1 percent from 5 percent after the bank denied having asked Chanda Kochhar to go on leave. “She is on her annual leave which was planned in advance. Further, the Board denies that it has appointed any search committee to find her successor.”
Bajaj Finserv, IndusInd Bank, Bajaj Finance, HUL, Axis Bank, Kotak Mahindra Bank, Tata Steel, GAIL and SBI slipped 1-3 percent. Reliance Industries (up 1 percent), HDFC (0.61 percent), Bharti Airtel (2.7 percent) and Hindalco Industries (1.84 percent) were among Nifty50 gainers.
On the global front, European stocks rallied after Italian parties agreed to form a government, though renewed concerns of a global trade capped gains. France’s CAC and Germany’s DAX gained over a percent each while Britain’s FTSE gained 0.9 percent at the time of writing this article.
Asian markets ended mixed amid trade concerns. Oil prices were mixed with Brent crude futures were at $77.74 a barrel, up 0.23 percent.