Sensex today falls over 700 points and then recovers all losses
Premium- The market is likely to continue in the consolidation phase for a short while, which can be an opportunity for investors to buy on dips, say analysts
Indian stock markets ended flat in a volatile session, after falling sharply in early trade. Intra-day Sensex fell over 700 points when it hit 51,601 at day's low but later ended 21 points higher at 52,344. Similarly, Nifty settled flat at 15,683, after sliding below 15,500 at day's low. The broader markets however ended weak with BSE midcap, smallcap indices falling over 0.7% and 0.9% respectively. The rupee also rebounded today from intra-day losses to settle at 73.86 against US dollar.
Avinash Gorakshkar, head of research at Profitmart Securities, attributed the jitteriness in markets to two reasons: Fed changing its stance on interest rate earlier this week and China announcing to use its metal reserves to check metal price rise.
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Investor also weighed a sharp drop in commodity prices which have been pressured by China's plan to sell reserves and a firm dollar.
The Nifty metal index fell nearly 1% today with Vedanta, JSW Steel and SAIL falling over 3% each.
"The market continued to be in the consolidation phase witnessing broad-based selling, taking cues from the Fed policy and mixed global markets. US bond yields have cooled off from its high as global markets seem to have digested the latest Fed comments. China’s plan to sell metal reserves to check recent price hikes has pulled down the sector's sentiments," said Vinod Nair, Head of Research at Geojit Financial Services.
"The market is likely to continue in the consolidation phase for a short while, which can be an opportunity for investors to buy on dips," he added.
ONGC was the top loser in the Sensex pack, shedding around 4%, followed by NTPC, PowerGrid, M&M, Nestle India, SBI and HCL Tech. On the other hand, HUL, Bajaj Auto, Bharti Airtel, Bajaj Finserv were among the gainers.
"Nifty halted a four-week winning streak as it ended the week 0.73% lower. Panic selling has been absorbed well so far in the markets and local investors have taken these sell-offs as an opportunity to add to their positions. Absence of a sharp selloff in global markets is helping keep sentiments steady here. Follow through buying however may be selective and index gains from hereon may be relatively slow. On the upside the Nifty could face resistance at 15750 while 15430 could provide support on downmoves," said Deepak Jasani, Head of Retail Research, HDFC Securities.
(With Agency Inputs)
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