Sensex up 125 at closing, Nifty above 16,200

Benchmark indices closed with marginal gains, led by IT and Financials.

Market, after a positive opening, remained volatile through the day, moving in a narrow range due to a lack of fresh triggers. Profit-booking was witnessed in sectors such as metal, PSU Bank, Realty and Oil& Gas.

However, late-hour buying in index heavyweights lifted the bechmarks. The BSE Sensex closed at 54,402.85, up 125.13 points or 0.23 per cent. It hit an intraday high of 54,584.73 and a low of 54,124.27. Nifty 50 closed at 16,258.25, up 20.05 points or 0.12 per cent. It hit an intraday high of 16,320.75 and a low of 16,179.05.

Breadth favours decliners

The breadth of the market turned in favour of the decliners with a ratio of 2:1 as 2,039 stocks declined, 1,291 advanced and 146 remained unchanged on the BSE. Furthermore, 381 stocks hit the lower circuit as compared to the 366 stocks that were locked in the upper circuit. Besides, 370 stocks touched 52-week high level and 35 touched a 52-week low.

Mahindra & Mahindra, Tech Mahindra, Axis Bank, Bajaj Finserv and IndusInd Bank were the top gainers on the Nifty 50 while Tata Consumer, Coal India, Adani Ports, Bharti Airtel and SBI Life were the top laggards.

Milind Muchhala, Executive Director, Julius Baer said, “Till last week, for almost two months, the Indian markets were trading in a very narrow band, with every small intermittent correction getting bought into. However, last week we saw a distinct break-out of the band as well as some key technical levels, which resulted in a fresh wave of interest amongst investors and traders.”

According to Muchhala, corporate earnings for Q1 FY 2022 have also panned out relatively well.

“The global set-up also remains quite supportive, especially with the US markets breaching their all-time highs last week. The economic environment also seems to be staging a good recovery in the past couple of months, as reflected in the various high-frequency indicators.”

“The index, however, seems to have taken the baton from the midcap and smallcap space which has gone into a small correction mode over the past few days after a significant outperformance in the past two months. Additionally, the IPO frenzy also continues, with a number of IPOs lined up this month, which seems to be sucking up some liquidity,” Muchhala said.

“We expect the market to see some sector rotation with the relatively underperforming sectors over the past couple of months, especially Financials and Auto, staging some comeback,” he added.

Financials, IT in focus

On the sectoral front, while metals and Oil & Gas stocks were under pressure, financials excluding PSU Bank and IT gained. Healthcare and pharma stocks also recorded marginal gains in the second half while realty and auto stocks tracked losses.

Nifty Bank was up 0.61 per cent at closing while Nifty Financial Services was up 0.39 per cent. Nifty Private Bank was up 0.69 per cent while Nifty IT was up 0.44 per cent. Nifty Pharma was up 0.11 per cent while Nifty Healthcare Index was up 0.14 per cent.

Meanwhile, Nifty Metal was down 1.87 per cent. Nifty PSU Bank was down 1.56 per cent while Nifty Oil&Gas was down 1.10 per cent. Nifty Realty was trading 0.73 per cent lower while Nifty Auto was down 0.10 per cent.

Broader indices

Midcap and smallcap stocks continued to face selling pressure as broader indices closed in the red.

Nifty Midcap 50 was down 1.29 per cent while Nifty Smallcap 50 was down 1.11 per cent. The S&P BSE Midcap was down 1.07 per cent while the S&P BSE Smallcap was down 0.72 per cent.

The volatility index fell 0.01 per cent to 12.61.

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