Nifty may drift sideways for a few days before a bigger move
We had mentioned in Wednesday’s closing report that Nifty, Sensex were getting overbought and that the rally has been on lower volumes. Snapping six consecutive sessions' rally, key Indian equity market indices ended in the red.
The market fell by about 0.6% without any negative input from the government or RBI (Reserve Bank of India). The 100-scrip and 200-scrip indices were lower by 0.62% and 0.58%, respectively. The mid-cap index was lower by 0.32% and small-cap stocks were lower by 0.18%. In Thursday's trade, selling pressure was seen in capital goods, energy, IT and oil and gas sectors. Sector-wise, the S&P BSE capital goods index dropped by 1.70%, energy index fell by 1.56%, IT index slipped by 1.33% and oil and gas index went down by 1.05%.
Foreign institutional investors' continued interest in equities ensured that falls were limited, despite the volatility that also saw profit booking early in the day. However, more stocks were seen declining in NSE, when compared to those that advanced.
The major Sensex gainers on Thursday were: HDFC, up 1.91% at Rs.1,152.60; Asian Paints, up 1.84% at Rs.893.15; Maruti, up 1.39% at Rs.3,627.15; and Bharti Airtel, up 1.10% at Rs.338.80. The losers were: BHEL, down 3.07% at Rs.104.35; Reliance Industries, down 2.87% at Rs.1,012; Infosys, down 2.76% at Rs.1,145.95; and GAIL, down 2.50% at Rs.341.35. Among the Asian markets, Japan's Nikkei was higher by 1.26%, while Hong Kong's Hang Seng receded by 0.06% and China's Shanghai Composite Index ended lower by 2.03%. The European Central Bank on Thursday cut interest rates again, dropping its key lending rate to zero while pushing its deposit rate further into the negative. ECB is also ramping up the size and scope of its asset-buying programme to include corporate debt. It also introduced a fresh round of cheap, long-term loans for eurozone banks. The initial reaction of the market was euphoric. But later in the press conference, when ECB chief Mario Dragi said that this could be the last time, rates were being cut, the stocks receded.
The top gainers and top losers of the major indices are given in the table below:
The closing values of the major Asian indices are given below: