A close below 8500 on Nifty may lead to a strong decline
We had mentioned last week that NSE’s CNX Nifty has to remain above 8,460 for the uptrend to continue. The 50-stock benchmark opened Monday marginally lower. It moved in the green for almost the entire session and dipped in the end, recording marginal gains.
India VIX rose 5.63% to close at 15.3900. NSE recorded a volume of 111.03 crore shares.
Last week's announcement of Rs70,000 crore infusion into public sector banks (PSBs) in the next four years continued to boost banking stocks. The wider 50-scrip Nifty, however closed flat during the day's trade. It edged-up only 10.20 points or 0.12% at 8,543.05 points. The 30-scrip S&P BSE Sensex, which opened at 28,089.09 points, closed at 28,187.06 points, up 72.50 points or 0.26% from the previous day's close at 28,114.56 points.
According to analysts, domestic markets remained positive on the back of a surge in banking and auto stocks ahead of the RBI's monetary policy review on Tuesday.
The markets rise was arrested by the higher levels of profit booking which trimmed some of the early gains due to weak Greece and Chinese stock markets, cited analysts.
India Inc expects a rate cut by the RBI during RBI’s review tomorrow. Indian industry feels that the upcoming review might be the last chance by RBI to cut rates in this calendar year before inflation spirals up and the US Fed decides on its own rates in September. However, the continuous slide in the Chinese markets, weakening of the rupee, oil and global commodities prices had a negative impact on the Indian markets.
The slide in the Chinese markets in the last two months has eroded nearly 40% of the stock value and caused panic. More importantly, the inability of the Chinese government, fund houses and brokerage firms to arrest the fall has led to global sell-offs.
Major Sensex gainers during Monday's trade were State Bank of India (SBI), up 3.94% at Rs.281.05; ICICI Bank, up 3.40% at Rs.312.80; Maruti Suzuki, up 2.29% at Rs.4,429.60; Dr Reddy's Lab, up 2% at Rs.4,146.85; and BHEL, up 1.58% at Rs.283.10.
The major Sensex losers were Vedanta, down 2.50% at Rs.126.90; Mahindra and Mahindra, down 2.04% at Rs.1,333.80, Coal India, down 1.96% at Rs.430.70; Lupin, down 1.93% at Rs.1,663; and HDFC Bank, down 1.49% at Rs.1,094.60.
Sector-wise, healthy buying was observed in banking, consumer durables and automobile stocks. However, metal, information technology (IT) and oil and gas scrips came under selling pressure.
The S&P BSE banking index zoomed by 212.49 points, the consumer durables index rose 151.42 points and the automobile index went up 139.27 points.
The S&P BSE metal index declined by 93.86 points, followed by the IT index which fell 58.81 points while the oil and gas index was lower by 50.20 points.
The top gainers and losers in the major indices are given in the table below:
Among the Asian markets, Japan's Nikkei was down 0.18% and Hong Kong's Hang Seng fell by 0.91%. China's Shanghai Composite Index was lower by 1.11%.
In Europe, the London FTSE 100 index inched down by 0.02%. Germany's DAX Index moved up by 0.84%. The French CAC 40 was higher by 0.67%.