Indian benchmark indices, the Nifty and the Sensex, remained in the red throughout Tuesday.
The Nifty closed at 5,037.5, down 80.75 points or 1.58 per cent, while the Sensex closed at 16,748.29, down 276.80 points or 1.52 per cent, over its previous close. Persisting uncertainty in the Eurozone was the main reason, said marketmen.
Experts said that if investors follow the market trends daily in order to try and make money, they run the risk of eroding their capital when the actual time comes to invest, given the volatility. The volatility index India Vix was up 1.84 per cent and closed at 25.9.
“When the economic situation in a small country like Greece can shake the whole world, it means that no one is isolated,’’ said the Head of Research of an Indian brokerage.
“The problem is that no one has ever experienced such a situation before and even if the Eurozone debt is written off, no one really has an idea on what the consequences would be and who would face them.”
Coal India, BPCL, Ranbaxy, Gail and Power Grid were the top five gainers while HCL Tech, TCS, Hindalco, Tata Motors and RCom were the top five losers.
With the major banking counters recouping significant portion of their losses, the Bank Nifty was able to cut the loss at the close today.
But the CNX IT ended with substantial loss as the IT stocks were not able to replicate the recovery of the banking stocks.
The Bank Nifty, which was down by about 220 points in the morning, closed down by 137.40 points, thanks mainly to the bounce-back of SBI and to some extent by ICICI Bank and Axis Bank shares.
SBI, which was down by about Rs 50 in the morning, trimmed its losses to just Rs 6.70 at the close, thanks probably to the news that some decision on the bank recapitalisation was to be taken later in the day. The share closed at Rs 1,885.
Axis Bank, which was down by about Rs 34 in the morning, cut its loss to Rs 18.75 to end the day at Rs 1,103.10 and ICICI Bank’s loss also was down from Rs 26.65 in the morning to just Rs 16.85 at the close with the share ending at Rs 882.
However, while in the morning all 12 banking stocks in the Bank Nifty were in the red, HDFC Bank managed to claw back to the green, gaining Rs 3.15 to close at Rs 481.20.
But the CNX IT was down 215.50 points with TCS and HCL Tech losing 7.43 per cent and 9.10 per cent, respectively, along with Infosys and Oracle Financial that were also in the red. Only Patni, MindTree, Financial Technologies and Onmobile were in the green at the end of trading.