Nifty fails to hold 10,450, Midcap outperforms Sensex; Divis Labs lifts Pharma index 3%

Moneycontrol News

Equity benchmarks closed rangebound session flat with a negative bias on Thursday after investors digested the outcome of Federal Reserve policy meeting and focussed on corporate earnings.

The 30-share BSE Sensex was down 27.05 points at 33,573.22 after intraday swing of around 130 points. PSU banks, FMCG, oil & gas and select auto stocks were under pressure while healthcare stocks and ICICI Bank capped losses.

The 50-share NSE Nifty lost 16.70 points to close at 10,423.80, after hitting an intraday record high of 10,453 in opening trade.

The consolidation after a record high was warranted, which may continue for couple of sessions before moving up further towards fresh record high, experts feel.

"It's a healthy pause and we believe the prevailing momentum will continue. Banking has made a new record high of late and that should lead the rally," Jayant Manglik, President, Retail Distribution, Religare Securities said.

The Nifty has potential to test 10,600 in near future, he feels. Traders should remain focused on stock selection and avoid contrarian trades, he advised.

"Overall we are yet to see the level of bullishness and complacency which could signal the end of the inherent bull trend. This rally could have further legs in the short term; but we would still not advocate taking fresh longs at this juncture," Nikhil Kamath, Co-Founder and Head of Trading, Zerodha said.

The broader markets outperformed benchmarks throughout session as the Nifty Midcap index was up 0.2 percent and Smallcap rose 0.7 percent despite weak breadth. About 808 shares declined against 737 advancing shares on the NSE.

Global markets were also subdued in trade after investors digest earnings and Federal Reserve policy meeting, and await Bank of England decision.

Tech Mahindra fell 4 percent despite better-than-expected earnings in September quarter, as majority of analysts retained sell call on the stock, citing worries over margin growth.

Divis Labs rallied 17 percent after the company said the US Food and Drug Administration would be lifting the Import Alert 66-40 and moving to close out the warning letter issued to the company's unit-II at Visakhapatnam.

It was a sentiment booster for other pharma stocks. Nifty Pharma index gained 3 percent. Wockhardt and Biocon were up 3-5 percent while Sun Pharma, Lupin, Dr Reddy's Labs and Cipla gained 1-3 percent.

Aurobindo Pharma rallied 3.7 percent on getting USFDA approval for Fexofenadine & Pseudoephedrine Hcl tablets. Fexofenadine is used for treatment of allergy symptoms such as hay fever and Pseudoephedrine is used as a nasal/sinus decongestant.

Power Grid Corporation gained 2 percent ahead of earnings later today while Hero MotoCorp slipped 2.2 percent after October sales missed analyst expectations.

ITC, SBI, Bharti Infratel, HUL and ONGC among others were down 1-2 percent whereas ICICI Bank, TCS, HCL Technologies and Adani Ports gained 1-2 percent.

After earnings, Hexaware Technologies, Shriram Transport, Orient Cement, D-Link India and Borosil Glass Works gained 1-14 percent while Apollo Tyres was down 3 percent.

Aksh Optifibre, 8K Mile Software, Hindustan Copper, Dredging Corporation, MMTC, STC, Titan Company, Just Dial, PFC, REC, Edelweiss Financial, Jain Irrigation and Infibeam rose 3-20 percent while IDFC Bank and Voltas were down 2-5 percent.