Sensex, Nifty drop 1% in September; 236 stocks in BSE 500 rise

September did not augur well for equity benchmarks Sensex and Nifty as both closed the month with losses.

Lacklustre global cues, rising cases of COVID across the globe, caution ahead of approaching US elections, uncertainty over the stimulus package, and talks of another lockdown in several parts of the world kept investors' sentiment subdued.

Sensex fell by 1.45 percent and Nifty dropped 1.23 percent in September. On the other hand, BSE Midcap inched up by 0.3 percent but the BSE Smallcap index logged strong gains of 3.71 percent.

Among the sectoral indices, BSE IT rose 10.66 percent followed by Pharma, Consumer Durables and Teck indices. On the flip side, BSE Telecom and Bankex suffered strong losses of 15.66 percent and 9.71 percent, respectively.

Overall, 236 stocks in the BSE 500 index logged gains in the month of September.

On a stock-specific basis, Advanced Enzyme Technologies and Adani Green Energy logged gains of 66 percent and 63 percent, respectively, in September, emerging as the top gainers in the BSE 500 index.

Among the losers, Future Retail, Alok Industries and Future Consumer stood at the top, losing up to 44 percent during the month.

The global cues seem to have turned slightly positive now, led by better-than-expected macro data prints and rising hopes for an additional stimulus package.

Unlock 5.0 and a host of positive macro data are encouraging for the market. September auto sales numbers have also come out decent.

Green shoots are appearing in the economy and the sentiment is underpinned by reports that we may soon get an effective vaccine for COVID. Reports suggest positive progress towards a possible coronavirus treatment by Regeneron Pharma and Moderna's coronavirus vaccine trials.

However, concerns persist.

Rising COVID-19 cases in the US and the resurgence of the virus in Europe continue to remain a major overhang.

Going ahead, the market may continue to see volatility and may remain rangebound.

"The market may remain rangebound with positive bias in the near-term amid hopes of stimulus announcement both from the US and Indian government," said Siddharth Khemka, Head – Retail Research, Motilal Oswal Financial Services.

"Nifty is holding well above its 50-DMA. The overall structure of the index is positive as supports are gradually shifting higher. The market would get direction from the outcome on the loan moratorium case on Monday; RBI’s monetary policy on Tuesday; and the September quarter results season which would kick start from next week with TCS reporting its numbers on Wednesday," Khemka added.