Indian markets ended lower today, snapping a six-day winning run. Losses in financials outweighed gains in information technology and metal stocks. The NSE Nifty 50 bluechip index ended down 0.32% at 10,029.10, while the S&P BSE Sensex slipped 128 points to 33,980.70. Sensex had logged gains of about 3,500 points in the past six sessions.
The Nifty banking index fell 2.63%, but was still up 5.7% for the week, following a 11.7% surge last week.
Banking stocks came under pressure after the Supreme Court sought the finance ministry’s reply on a petition seeking waiver of interest on loans during the moratorium period. The RBI has told the apex court that it would not be prudent to go for a “forced waiver of interest” risking financial viability of the banks.
Among stocks, HDFC and HDFC Bank Ltd were the top drags on the Nifty 50 index, ending down 3.89% and 2.01%, respectively. Meanwhile, the Nifty IT index closed 1.85% higher, while the metals index gained 1%. Vedanta Ltd was the top gainer in Nifty 50 index, ending up nearly 8%.
Here is what analysts say on today’s market action:
Vishal Wagh, Research Head, Bonanza Portfolio
“Going forward, 9930 will work as support, below which we are expecting Nifty to fall till 9,700. On the higher side, 10,200 will work as resistance. For Bank Nifty major support will be 20,300 and resistance will be seen at 21,900. Above 21,900 it may test 22,450 on the lower side below 20,300 it can touch 19,400.”
Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities
“Bank Nifty and benchmark Nifty traded with steep losses after the Supreme Court raised concerns over the levying of interest on loans during the six-month moratorium period. However, technology, telecom and pharmaceutical stocks managed to shrug off the weak market sentiment and helped the Nifty to close above the crucial level of 10,000. Our markets are still lagging as compared to the rally in world markets. More clarity on the statement of Supreme Court will decide the trend in financials and banking stocks going ahead. The strategy should be to buy on dips between 9,900 and 9,800 with a final stop loss at 9,700. On the higher side, 10,120 and 10,180 would be hurdles for Nifty.”
Ajit Mishra, VP – Research, Religare Broking Ltd.
“Markets took a breather and ended marginally lower after hovering in a range. It opened in the green, taking cues from the global markets but the gains soon fizzled out due to continuous profit-taking in banking and financial stocks. However, noticeable buying interest in the IT and pharma majors capped downside. The Nifty index finally ended lower by 0.3% to close at 10,029 levels. The broader markets outperformed the benchmark and managed to end almost unchanged.”
“This pause is largely on the expected lines and we may see further consolidation ahead. However, we feel Nifty could make another attempt to test 10,250 levels so traders should utilise further dips around the 9,900 zone to create fresh longs. On the sectoral front, we prefer pharma, IT at current levels and select private banking names on dips.”
Rohit Singre, Senior Technical Analyst at LKP Securities.
“Index again managed to close above 10k mark with minimal loss of 32 points and formed a doji candle pattern on daily chart which hints uncertainty in the markets. Going forwards 9900-9800 zone become good base in index and on the higher side 10100-10200 is become immediate hurdle, technically speaking index can see some consolidation move in the zone of 9800-10200 so traders are suggested to use mentioned levels to trade. Nifty bank has seen sharp cuts again as it closed a day at 20390 with loss of nearly three percent, support for nifty bank is coming near 20150-20000 zone and resistance is coming near 20660-21000 zone”.
Vinod Nair- Head of Research- Geojit Financial Services
“The markets were undecided and finally ended slightly negative, after 6 successive days of gains. The banking index which had driven the gains for the last few days was incidentally the biggest loser in today’s trade. Global cues were also mixed after Asian markets ended positive but European markets were awaiting details on ECB’s stimulus plans. Domestically, markets still seem to be forward looking, ignoring the recent quarterly results and economic data, and anticipating a turnaround in the economy.”
(With Agency Inputs)