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Market erased all gains to end flat on Tuesday amid increased selling pressure in Auto, IT and Pharma during closing hours.
Benchmark indices remained rangebound through the day, ahead of the crucial Q1 FY 2022 result season. A recovery in financials and gains in cement stocks along with heavyweights such as HDFC supported the market.
The BSE Sensex closed at 52,861.18, down 18.82 points or 0.04 per cent. It breached the 53,000-mark during the day, recording an intraday high of 53,129.37 and a low of 52,804.18. The Nifty 50, which had crossed the 15,900 with an intraday high of 15,914.20, closed at 15,818.25, down 16.10 points or 0.1 per cent. It hit an intraday low of 15,801.00.
Breadth favours decliners
On the BSE, The market breadth was negative, with 1,666 stocks declining, 1,591 advancing and 129 remaining unchanged. As many as 506 securities hit the upper circuit and 228 lower; 549 hit their 52-week high while 23 touched a 52-week low.
Binod Modi, Head Strategy at Reliance Securities, said, “Domestic equities traded in a rangebound with Nifty breaching 15,900 levels mainly supported by a sharp rebound in financials. However, selling pressure in Auto, IT, Pharma and FMCG overshadowed a surge in Financials.”
“Improved prospects of higher credit growth led by a pick-up in economic activities and the increasing possibility of higher recovery aided banking stocks. Further, cement stocks were in focus today on expectations of strong 1QFY22 earnings,” added Modi.
Ultratech Cement, Shree Cement, HDFC Bank, Bajaj Finance and SBI Life were the top gainers on the Nifty 50 while Tata Motors, Tech Mahindra, Coal India, TCS and Mahindra & Mahindra were the top laggards.
HDFC Bank gains on positive outlook
The shares of HDFC Bank gained on the market today after the bank reported a 14.4 per cent growth in its advances to about ₹11,47,500 crore as of June 30, 2021, compared to ₹10,03,300 crore a year ago, with analysts seeing the further upside.
Axis Securities labelled the stock as one of the “resilient stocks” in the sector. It maintained a ‘Buy Rating’ on the stock with a target price of ₹1,785/share (SOTP basis core book at 3.6x FY23E and ₹40 Subsidiary Value).
Emkay Global Securities also maintained a ‘Buy’ rating on the stocks with a target price of ₹1,850.
HDFC Bank closed 2.44 per cent higher at ₹1,531.95 per share on the NSE.
Auto, IT, PSU Banks under pressure
Most indices closed in the red on the sectoral front, with Auto, IT, PSU Bank and Pharma stocks witnessing increased selling pressure.
However, Financials remained resilient through the day. Nifty Bank was up 1.04 per cent while Nifty Private Bank was up 0.92 per cent. Nifty Financial Services was 0.97 up per cent.
Meanwhile, Nifty PSU Bank was down 1.26 per cent.
Nifty Auto was down 1.74 per cent, recording the highest losses. Nifty IT and Nifty Pharma were down 1.04 per cent and 0.84 per cent, respectively. Nifty FMCG was down 0.42 per cent.
Broader indices
Broader indices closed in the red, with smallcap stocks also witnessing selling pressure.
Nifty Midcap 50 was down 0.08 per cent, while Nifty Smallcap 50 was down 0.85 per cent.
The S&P BSE Midcap was up 0.19 per cent, while the S&P BSE Smallcap was down 0.26 per cent.
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