Markets erase previous gains on weak global cues; Banking, IT stocks drag; Maruti, Axis Bank, TCS top losers

Sensex and Nifty 50 erased their previous gains as feeble global peers dampened sentiment on Thursday owing to fresh highs in bond yields. Both benchmarks have dipped by nearly a percent. Although broader markets were in the red, the mid-cap and small-cap stocks showed a certain degree of resistance. Banking stocks took lead in the selling bias followed by IT, auto, and consumer durables stocks.

After market hours, Sensex closed at 58,909.35 lower by 501.73 points or 0.845. While Nifty 50 tumbled by 129 points or 0.74% to finish at 17,321.90. India’s volatility index ended marginally lower.

In the previous session, both Sensex and Nifty 50 gained by a percent.

Maruti Suzuki emerged as a top loser with a downside of 2.4% after a shortage of electronic components impacted sales and production performance in February month. While Axis Bank stock followed with a drop of 2.2% after completing Citibank’s deal.

TCS, M&M, Nestle, Infosys, Tech Mahindra, Bharti Airtel, Tata Motors, Kotak Bank, and Bajaj Finance were other draggers by plunging between 1% to 2%.

On the gainers front, on Sensex, Sun Pharma and Power Grid took lead with an upside of nearly a percent followed by HCL Tech and L&T.

However, amidst a selloff in the broader market, all Adani stocks were in the green with an upside from 1.5% to 5%.

In terms of sectoral indices, the banking stocks took a massive beating but it was IT stocks which was the top laggard in percentage terms.

BSE Bankex dipped by 403.29 points or 0.87%. While Bank Nifty slipped by 308.35 points or 0.76%.

IT index on BSE shed 370.43 points or 1.24%. Also, the Auto and Consumer Durables index dropped by 249.76 points and 222.78 points respectively.

Rohan Shah, Head of Technical Research at Stoxbox said, “Sebi was directed by Supreme Court to probe Adani,” adding, “today, the IT Sector is the top loser, while the Realty sector is the top gainer.

At the interbank forex market, the rupee snapped its 2-days gaining spree and weakened along with forward premiums on Thursday as bond yields picked up after more economic data signaled for inflationary pressure still lingering in the economy which could push central banks for more rate hikes.

The local currency closed at 82.5925 against the US dollar compared to the previous day’s print of 82.50 per dollar. While 1-year rupee forward premiums dipped to 2.06% — which would be the lowest reading since February 20th.

Shah added, “In the intraday sessions, After the gap-down opening, Nifty traded below 17,400 after making a day high of 17,445 in the morning trade & trade lower throughout the day. No follow-up candle forming above or below 200 DMA. Intraday, traders can look for long opportunities only above the resistance level of 17,500 & the price should sustain above 17,500 for 15 minutes to confirm long. raders can look for fresh shorts only if nifty breaks the 17,250 level & remains below for 15 min to ensure short. ill that time, it will stay in the range of 17250 to 17500.”

Also, on Bank Nifty, Kunal Shah, Senior Technical Analyst at LKP Securities said, “the bears came back strong and the index witnessed stiff resistance at 41,000 where fresh call writing was visible. The index remains in a sell-on-rise mode as long it stays below the mentioned resistance zone. The index’s immediate support on the downside stands at 40,000 and if breached will lead to a further downside towards 39,500 levels.”

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