Nifty is likely put in a significant rebound if it closes above 7,550
We had mentioned in last week’s closing report that Nifty, Sensex are deeply oversold and that Nifty has to close above 7,600 for a rally to materialise. The market indices fell by more than 1% due to global cues. The major indices of the stock markets are given in the table below:
Falling exports, coupled with a slump in global crude oil prices, accelerated selling pressure in the Indian equity markets on Monday and led the benchmark indices to their lowest close in the last 20 months. The selling frenzy led both the bellwether indices of the Indian equity markets to end the day's trade at levels last seen during May 2014. They even touched their new 52-week low during the intra-day trade. Overall, the market breadth ended with extreme weakness -- as seven shares declined for every one share that advanced. The selling pressure was stoked by disappointing December exports' data, which touched a 13-month low, absence of fresh triggers and bearish global cues. Furthermore, investors were seen cautious regarding the upcoming global macro-economic data from China, the UK and the US.
On Tuesday, the US is expected to release its consumer price index (CPI), while China comes out with its index of industrial production (IIP) and GDP (gross domestic product) data points. Besides, long-liquidation positions and disappointing macro-data which was released earlier in the week eroded investors' hopes for an interest rate cut during the upcoming monetary policy review of the apex bank.
Initially, both the Indian bellwether indices opened on a negative note, following lower closing of the US markets on Friday when they crashed by more than 2%. However, both indices soon pared their initial losses on the back of positive European markets, expectations of healthy Q3 results and short-covering. In addition, prices were supported by Prime Minister Narendra Modi's Start-Up India Action Plan which was released on Saturday.
The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) closed lower by 267 points or 1.09% -- its lowest closing since 16 May 2014.
Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) ended the day's trade deep in the red. It was down by 86.80 points or 1.17% at 7,351 points -- its lowest closing since 30 May 2014.
The NSE Nifty breached the psychological level of 7,400 points during the day's trade. It also touched a new 52-week low at 7,336.40 points.
The S&P BSE Sensex, which opened at 24,400.78 points, closed at 24,188.37 points -- down 266.67 points or 1.09% from the previous day's close at 24,455.04 points.
During the intra-day trade, the Sensex touched a high of 24,524.85 points and a low of 24,141.99 points -- its new low in 52 weeks.
The S&P BSE market breadth favoured the bears -- with 2,424 declines and only 305 advances.
Banking index reversed in late trade after a minor pull back confirming the bearishness dominant in banking shares.
Sector-wise, shares of healthcare, capital goods, automobile, banking and consumer durables came under selling pressure.
The S&P BSE healthcare index plunged by 305.93 points, capital goods index receded by 256.13 points, automobile index declined by 246.43 points, banking index slumped by 199.81 points and consumer durables index edged-lower by 120.27 points.
The foreign institutional investors (FIIs) were net sellers during the day's trade, while domestic institutional investors (DIIs) were net buyers. According to data with stock exchanges, FIIs divested Rs1,203.84 crore, while DIIs bought stocks worth Rs1,122.80 crore.
Apart from equities, the rupee got battered in the day's trade. It touched a new 28-month low. It ended weaker by nine paise at 67.68-69 to a US dollar from its previous close of 67.60 to a greenback.
Major Sensex gainers during Monday's trade were BHEL, up 4.29% at Rs142.35; Tata Steel, up 2.76% at Rs236.25; Tata Consultancy Services (TCS), up 0.84% at Rs2,282.45 and Wipro, up 0.72% at Rs547.35.
Major Sensex losers during day's trade were Reliance Industries, down 5.14% at Rs1,018; Bajaj Auto, down 3.29% at Rs850.60; Asian Paints, down 3.29% at Rs850.60; Cipla, down 2.72% at Rs590.85; and ONGC, down 2.12% at Rs.214.90.
The top gainers and top losers of the major indices are given in the table below:
The closing values of Asian indices are given in the table below: