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Taking Stock | Market Ends Lower For The Second Day; Sensex Dives 656 Points, Nifty Below 18,000

The market continued to see profit-booking for the second consecutive day, with benchmark Sensex and Nifty falling a percent each on January 19 on weak global cues and high crude prices.

The Indian benchmark indices started on a negative note and extended the fall as the session progressed to end near the day\’s low.

At close, the Sensex was down 656.04 points, or 1.08 percent, at 60,098.82, and the Nifty was down 174.60 points, or 0.96 percent, at 17,938.40.

\”Globally, risk sentiments took a blow as rising inflation resulting in elevated bond yield along with the on-going geopolitical tensions and surge in oil prices weighed on investor confidence,\” said Vinod Nair, Head of Research at Geojit Financial Services.

Selling by foreign institutional investors (FIIs), too, weighed on the market, Nair said.

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While early trends show that most companies’ December earnings have been in line with estimates, higher input costs have started to affect profit margins. Continued rise in Covid cases and the increase in oil prices would likely to hit margins in the next quarter, analysts said.

Asian Paints, Shree Cements, Infosys, Grasim Industries and HUL were the top Nifty losers, while gainers included ONGC, Tata Motors, SBI, Coal India and UPL.

On the sectoral front, Nifty IT and FMCG indices fell 1-2 percent, while Nifty PSU bank index added 2 percent.

Index Prices Change Change%
Sensex 60,098.82 -656.04 -1.08%
Nifty 50 17,938.40 -174.65 -0.96%
Nifty Bank 38,041.35 -168.95 -0.44%

Nifty 50 17,938.40 -174.65 (-0.96%)Wed, Jan 19, 2022

Biggest Gainer Prices Change Change%
ONGC 170.25 6.40 +3.91%
Biggest Loser Prices Change Change%
Infosys 1,867.05 -53.70 -2.80%
Best Sector Prices Change Change%
Nifty PSU Bank 2801.65 60.45 +2.21%
Worst Sector Prices Change Change%
Nifty IT 37281.70 -810.10 -2.13%

Broader markets performed better than the main indices. The BSE midcap index fell 0.3 percent and smallcap index ended flat.

Stocks and sectors

A mixed trend was seen on the sectoral front, with BSE auto, metal, power and oil & gas indices ending in the green. Selling was seen in the bank, FMCG, IT, pharma and realty sectors.

Long build-up seen in the Tata Power, Bank of Baroda and Chambal Fertilisers and short build-up seen in the L&T Technology Services, Info Edge and ICICI Prudential.

Among individual stocks, a volume spike of more than 200 percent was seen in Adani Ports, Trent and Bajaj Finance.

Over 300 stocks, including Cox & Kings, DB Realty, OnMobile Global, Tata Elxsi, Sobha, hit a 52-week high on the BSE.

Technical View

The Nifty formed a bearish candle on the daily scale and negated its higher highs formation of the last eight sessions.

\”Till the Nifty remains below 18,000, weakness could be seen towards 17,850 and 17,777 whereas hurdles exists at 18,081 and 18,200 marks,\” said Chandan Taparia, Analyst-Derivatives, Motilal Oswal Financial Services.

Outlook for January 20

Rahul Sharma, Co-owner, Equity 99

The correction in markets continued for the second day as markets correct a percent after US bond yields hit a two-year high. We see weakness in the market for the coming two weeks.

Investors are advised to keep strict stop losses and adopt buy-on-dips strategy. We expect the volatility to continue till the budget session. It is advised not to overtrade in the current scenario.

For the Nifty, 17,880 will act as immediate support, a break could see the index slipping to 17,765. On the upper side, 17,980 will act as strong resistance. Once the index goes past this level, it may move towards 18,075 and even 18,200.

Mohit Nigam, Head-PMS, Hem Securities

The benchmarks indices started the session in the red, tracking weakness in global markets and ended the session extending losses.

On the technical front, the key resistance level for Nifty is 18,300 and on the downside, 17,700 can act as strong support.

Key resistance and support levels for the Bank Nifty are 38,500 and 37,500.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

The Nifty closing below the important level of 18000 will be largely negative for the market. The index is likely to consolidate within the 17,82-18,050 range.

For the bulls, 17,960 would be the key level to watch for, and above it, the index could rally to 18,000-18,050. On the flip side, dismissal of 17,900 would trigger one more leg of correction up to 17,850-17,820 levels.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before making any investment decisions.

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