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Benchmark indices further slipped and were ruling nearing day’s low level on Monday afternoon as global stocks turned weak amidst rising US yield.
The rising number of Covid-19 cases and uncertainty around US bond yields continue to worry investors. According to Dr V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, investors must prepare for high volatility in the market.
At 1 pm, the Sensex was nearing the day’s low at 49,354.28, down 505.96 points, or 1.01 per cent. It hit an intraday high of 49,878.77 and an intraday low of 49,315.83.
The Nifty 50 was at 14,618.85, down 125.15 points or 0.85 per cent. It hit an intraday high of 14,763.90 and an intraday low of 14,610.15.
The BSE Sensex opened at 49,878.77 as against the previous close of 49,858.24, while the Nifty 50 opened at 14,736.30 as against the previous close of 14,744.00.
Investors fear that the increasing number of Covid-19 cases and likely restrictions in major cities will impact economic revival again.
According to Vijayakumar, the support comes from sustained FII buying which has crossed ₹7,000 crore during the plast four trading days.
Pharma stocks in focus
Pharma stocks gained focus with Sun Pharmaceutical Industries being the top gainers on the Nifty 50. Other top gainers included Adani Ports, Cipla, Britannia and Tech Mahindra.
The Nifty Pharma index was up 1.34 per cent in an otherwise volatile market.
Overall, among the sectoral indices, all indices except the Nifty Pharma, the Nifty FMCG, the Nifty IT and the Nifty Realty, were trading in the red.
The Nifty Realty managed to erase prior losses to gain 0.96 per cent.
Banking stocks under pressure
Meanwhile, banking stocks were under pressure during the afternoon trade with IndusInd Bank and ICICI Bank being among the top laggards on the Nifty 50. PowerGrid, Tata Motors and Reliance were among the top losers on the Nifty 50.
The Nifty Bank was down 1.83 per cent. The Nifty PSU Bank was down 1.42 per cent, while the Nifty Private Bank plunged 1.85 per cent.
Broader indices
Broader indices also faced selling pressure, erasing earlier gains. The Nifty Midcap 50 was trading flat, up 0.03 per cent, while the Nifty Smallcap 50 was down 0.50 per cent.
The S&P BSE Midcap was down 0.17 per cent, while the S&P BSE Smallcap was down 0.82 per cent.
Equity benchmark Sensex tumbled over 300 points in early trade on Monday, tracking losses in index majors Reliance Industries, HDFC Bank and ICICI Bank amid a weak trend in global markets.
The 30-share BSE index was trading 305.33 points or 0.61 per cent lower at 49,552.91, and the broader NSE Nifty fell 76 points or 0.52 per cent to 14,668.
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PowerGrid was the top loser in the Sensex pack, shedding around 2 per cent, followed by Reliance Industries, ICICI Bank, HDFC Bank and IndusInd Bank.
On the other hand, Sun Pharma, Dr Reddy’s, Asian Paints and Infosys were among the gainers.
In the previous session, the Sensex had ended 641.72 points or 1.30 per cent higher at 49,858.24, and Nifty had surged 186.15 points or 1.28 per cent to finish at 14,744.
Foreign institutional investors (FIIs) were net buyers in the capital market on Friday as they bought shares worth ₹1,418.43 crore, as per exchange data.
VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the market is in an excessively volatile zone. Support comes from sustained FII buying which has crossed ₹7,000 crore during the last four trading days.
Also read: Gold drops as dollar strengthens, traders focus on bond auctions
“But, there is a major dampener in the form of fast-rising Covid-19 cases, especially in some economically significant cities. Restricted economic activity in these regions might impact the optimistic growth projections for FY 22,” he added.
Elsewhere in Asia, bourses in Shanghai and Seoul were trading on a positive note in mid-session deals, while Hong Kong and Tokyo were in the red.
Meanwhile, the global oil benchmark Brent crude was trading 0.50 per cent lower at $64.21 per barrel.
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