Benchmark indices were off record highs to trade lower during the afternoon on Wednesday amid profit-booking.
After opening on a positive note tracking global cues, benchmarks rallied further to record new highs, led by gains in heavyweights such as HDFC Bank and Reliance. However, indices slipped into red, dragged primarily by metals and financials.
At 1 pm, the BSE Sensex, which surpassed the 56,000-mark, recording a new lifetime high at 56,118.57, was trading at 55,713.94, down 78.33 points or 0.14 per cent, near day’s low level of 55,707.99.
The Nifty 50, which also recorded a fresh all-time high of 16,701.85, slipped below 16,600 to trade at day’s level of 16,583.45 down 31.15 points or 0.19 per cent.
Ultratech Cement, Eicher Motors, Bajaj Finserv, Bajaj Finance and Divi’s Labs were the top gainers on the Nifty 50 while Hindalco, Kotak Bank, SBI Life, Tata Motors and JSW Steel were the top laggards.
According to VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, even as the market has been consistently setting new records, the journey of the market has been volatile with sharp ups and downs unnerving the short-term investors and traders. The future is unlikely to be any different.
“The Sensex has scaled the 56000 mark this morning. It is interesting to note that the Sensex has multiplied 560 times since its inception with 1979 as the base year. By averaging around 15 per cent CAGR during the last 42 years, Sensex has rewarded long-term investors handsomely,” Dr Vijayakumar said.
“The present bull run primarily driven by the new retail investors is in an overbought, richly valued zone. This year metal index has been the outperformer with Nifty Metal Index leading with 76 per cent return followed by the Nifty IT Index with 38 per cent return. But it is important to remember that even sectors with good earnings visibility, like IT and metals, are highly valued. Therefore, even while remaining invested in this bull market, investors have to be cautious while committing fresh funds,” Dr Vijayakumar added.
Pharma, IT and FMCG in focus, Metals lose shine
On the sectoral front, while pharma, IT and FMCG stocks continued to gain focus, metals, financials, realty and auto dragged.
Nifty Pharma was up 0.55 per cent while Nifty Healthcare Index was up 0.18 per cent.
Nifty IT was up 0.31 per cent while Nifty FMCG was up 0.42. Nifty Consumer Durables was up 0.19 per cent.
Nifty Metal was down 1.28 per cent. Nifty Bank and Nifty Financial Services were down 0.46 per cent and 0.27 per cent, respectively. Nifty Realty was down 1.01 per cent. Nifty Auto was down 0.37 per cent.
Broader indices
As for broader indices, Nifty Midcap 50 was down 0.10 per cent while Nifty Smallcap 50 was down 0.30 per cent. The S&P BSE Midcap was trading 0.13 per cent higher while the S&P BSE Smallcap was down 0.31 per cent.
The volatility index softened 1.75 per cent to 13.18 .
Naveen Kulkarni, Chief Investment Officer, Axis Securities said, “Mid caps and small caps have seen a sharp rally in the last few months and now some profit booking is visible in the space which is a healthy sign for the market.”