This was the aftermath of a brutal, but somewhat expected, bear attack on Dalal Street that left market participants who were buying early in the session bleeding on Thursday. Investors sold whatever they could grab on in a profit-booking frenzy.
All sectors witnessed heavy selling pressure, led by banks, financial services and IT stocks, as hopes of an early stimulus package vanished but Covid-19 continued to spread its legs in the developed world. Strong selloff in world markets also soured the mood back home.
BSE flagship Sensex was down 1,066 points or 2.61 per cent to 39,728. NSE benchmark Nifty followed, falling 291 points or 2.43 per cent to 11,680.
“The market had moved-up in expectation of a big stimulus, but the desired fiscal package was not announced in India and a delay of the same in US & Europe has changed the trend. At the same time, the pace of economic recovery is under stress because of a resurgence of high rates of Covid infection, mounting to high economic restrictions. The margin of safety is low given premium prices and slowdown in economic recovery,” said Vinod Nair, Head of Research at Geojit Financial Services.
Market at a glance:
- Infosys erases post earnings gains, end 2% lower on profit booking
- Banks bleed the most, led by private lenders; Nifty Bank down over 3%
- Likhitha Infra hits upper circuit after listing at 8% premium
- Mindtree plunges 8% ahead of Q2 earnings
- India VIX, measure of market volatility, jumps over 9% to 22-level
Among bluechip names, gainers could be counted on fingers of one hand. Asian Paints was the best performer with a 0.41 per cent rise followed by JSW Steel and Coal India that added 0.17 per cent and 0.05 per cent, respectively.
On the other hand, losers were available a dime a dozen, led by Bajaj Finance that slumped 4.98 per cent. Among other top losers were Tech Mahndra, ICICI Bank, IndusInd Bank, Reliance Industries, SBI, HDFC Bank and Bharti Airtel.
Nifty50 gaines & losers (Source: NSE)
Broader market indices fared better in comparison to their headline peers, for a change, but still closed deep in the red. Nifty Smallcap was down 1.72 per cent and Nifty Midcap slipped 1.70 per cent. Nifty 500, the broadest index on NSE, was down 2.19 per cent.
Mahanagar Gas, Gujarat State Petronet, JSW Energy, Gujarat Narmada Valley Fertilisers, Just Dial and Welspun India were among the biggest gainers from mid and smallcap indices, rising 1-14 per cent.
Persistent Systems, CanFin Homes, Thyrocare Technologies, Mindtree, Vodafone Idea and Prestige Estate Projects were among the top losers from the broader market space, sliding in the range of 4-8 per cent.
“This fall has engulfed the gains of the last six sessions and derailed the momentum as well. We suggest maintaining short positions and limiting trades largely to the index majors. Besides, participants should keep a close watch on global developments for cues.”
In the sectoral space on NSE, Nifty Bank was the biggest loser, down 3.36 per cent followed by its peer Nifty Private Bank and Nifty PSU Bank that slid about 3 per cent each. Nifty IT and NIfty Media were among other top gainers.
The market breadth was in favour of the losers with 816 stocks ending in the green, while 1,823 names settled with cuts. As many as 97 securities hit 52-week highs, mostly from the smallcap space.
Meanwhile, 59 names hit 52-week lows, mostly from the microcap space. About 210 stocks hit upper circuit limits and 226 lower circuit limits.
Markets world over also bled heavily. In Europe, German DAX and French CAC were down 2.73 per cent and 2.15 per cent, respectively, while London fell 1.34 per cent. All Asian markets also registered losses led by Hong Kong, Indonesia and Thailand.
Let’s prepare for tomorrow:
- Q2 earnings: HCL Tech, Bajaj Consumer, Federal Bank, Tata Communication, Tinplate Company, Shakti Pumps and Philips Carbon will come out with their earnings on Friday.
- Covid in Europe: The virus infections have surged in Europe and the US Midwest. Participants will keep a keen eye on the situation.
- Wall Street movement: How Wall Street behaves to a number of news will also be tracked as that will give a hint about how Asia and India could do.