Market erases early gains; Sensex down 243 pts at closing

Our Bureau. Mumbai | Updated on April 20, 2021

Nifty closes below 14,300

Market erased all early gains to end on a negative note on Tuesday, dragged by IT, FMCG and financials.

The market had rebounded sharply at the opening after the government announced its decision to open Covid-19 vaccination for citizens above 18 from May. However, the market turned volatile and erased early gains in the second half amid mixed global cues, while concerns related to Covid-19 cases in the country continue to dent investor sentiments. US stocks ended lower on Monday as investors awaited guidance from first-quarter earnings while Asian stocks traded mixed.

The BSE Sensex closed at 47,705.80, down 243.62 or 0.51 per cent, after hitting an intraday high of 48,478.34 and a low of 47,438.50. The Nifty 50, which slipped below the 14,300-mark to hit the day’s low at 14,207.30, closed at 14,296.40, down 63.05 or 0.44 per cent. It hit an intraday high of 14,526.95.

However, the breadth of the market remained buoyant, with 1,645 stocks advancing on the BSE, 1,232 declining and 172 remaining unchanged. The number of scrips that hit a 52-week high was 150 as against 47 that hit 52-week lows; 248 securities hit the upper circuit compared to 193 that hit the lower circuit.

Vinod Nair, Head of Research at Geojit Financial Services, said, "Indian markets witnessed a bounce-back in its opening trade, however, failed to hold onto its early gains due to weak global cues and the possibility of a stricter lockdown in Maharashtra. Despite the vaccine drive kindling hopes of recovery, the trend in the market will depend on positive developments like decreasing covid cases and lifting restrictions.”

Dr Reddy, Bajaj Finserv, HDFC Life, Bajaj Finance and Tata Consumer were among the top gainers on the Nifty 50, while HCL Tech, UltraTech Cements, HDFC, Grasim and Shree Cements were among the laggards.

Binod Modi, Head Strategy at Reliance Securities, said, “While domestic equities witnessed a brisk gap-up opening and traded in the green for most of the sessions mainly on positive sentiments after the government allowed vaccination for all above 18 years old from 1st May, selling pressure in IT, Financials and FMCG counters dragged benchmark indices lower towards the final session of the day.”

“FMCG and Cement stocks also witnessed heavy selling pressure due to emerging concerns over rural demand,” said Modi.

IT sees selling pressure, pharma gains

On the sectoral front, while IT FMCG and financials lagged behind, pharma continued to gain. The Nifty IT recorded the highest losses by declining 1.37 per cent at close. The Nifty FMCG was down 0.64 per cent, and the Nifty Financial Services was down 0.56 per cent.

However, the Nifty Pharma was up 1.29 per cent.

“Pharma stocks were in focus today as the announcement of opening up 50 per cent market for state government and private hospitals for Covid-19 vaccine created positive sentiments,” said Modi.

Broader indices outperform

Nifty Midcap 50 was up 0.43 per cent at closing, while Nifty Smallcap 50 was up 1.28 per cent as midcap and smallcap stocks managed to retain gains.

The S&P BSE Midcap and S&P BSE Smallcap were up 0.49 per cent each.

The volatility index softened 0.26 per cent.

Notably, Midcap and Small-cap stocks outperformed today as buying was seen in many quality midcaps and smallcap stocks,” said Modi.

Published on April 20, 2021

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