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Benchmark indices ended lower on Wednesday ahead of the festival holidays.
Market opened on a positive note amid mixed global cues as investors await the outcome of the US Fed MPC meet scheduled for later today. Market erased all early gains, with indices slipping further during closing hours, witnessing selling pressure across multiple counters, especially financials and pharma.
The domestic stock markets will remain closed on Thursday and Friday on account of Diwali.
The BSE Sensex closed at 59,771.92, down 257.14 points or 0.43 per cent. It recorded an intraday high of 60,361.82 and a low of 59,552.49. The Nifty 50 closed at 17,829.20, down 59.75 points or 0.33 per cent. It recorded an intraday high of 17,988.75 and a low of 17,757.95.
The volatility index slipped 5.49 per cent to end below 17 at 16.13.
Decliners outnumber
The market breadth turned in favour of the decliners with 1,643 stocks declining on the BSE, 1,596 stocks advanced and 162 remaining unchanged. Furthermore, 321 stocks hit the upper circuit as compared to the 176 stocks that were locked in the lower circuit. Besides, 207 stocks touched a 52-week high level and 20 touched a 52-week low.
Vinod Nair, Head of Research at Geojit Financial Services, said, “After a sideways movement post its positive opening, the indices took a downturn as major global indices traded weak ahead of the Fed policy announcement.”
“The Federal Reserve is widely expected to announce the tapering of its asset purchase program in the near-term while any hint on interest rate reversal is keeping investors on the edge. Any indications showing a faster rate of tapering will have a negative effect on the equity market. Or else, we can expect a reversal from this weak trend. On a positive note, despite the rise in input costs, India’s Services PMI jumped to 58.4 in October from 55.2 in September owing to ongoing improvements in demand boosting the growth of sales,” added Nair.
L&T, Asian Paints, Hindalco, Grasim and UPL were the top gainers on the Nifty 50 while Sun Pharma, IndusInd Bank, Bharti Airtel, ICICI Bank and Kotak Bank were the top laggards.
Moving into Samvat 2078, analysts expect relatively moderate returns for the coming year.
“Over the past one year we have seen the Nifty deliver a 50 per cent return, and the small /mid-cap indices broadly delivered around 80 per cent returns. It will be unfair to assume that the benchmark indices will deliver similar returns in the short term. Krishna Kumar Karwa, Managing Director - Emkay Global Financial Services said.
“Benchmark index returns in the short term may not be the right way to assess the investment opportunity. Right from IT, domestic manufacturing, real estate, and real estate full chain, to financial services, capital market intermediaries, and capital goods --- all the sectors are expected to do well over the medium term,” added Karwa.
Metals shine
On the sectoral front, all indices except Nifty Metal and Nifty Realty closed in the red. Pharma, FMCG, financials and auto stocks tracked losses.
Nifty Realty was up 1.94 per cent while Nifty Metal was up 0.93 per cent.
Meanwhile, Nifty Bank was down 1.34 per cent. Nifty Private Bank and Nifty PSU Bank were down 1.84 per cent and 0.49 per cent, respectively. Nifty Pharma was down 0.75 per cent while Nifty Auto was down 1.04 per cent. Nifty FMCG and Nifty Consumer Durables were down 0.64 per cent and 0.56 per cent, respectively.
Broader indices
Broader indices also ended lower.
Nifty Midcap 50 was down 0.43 per cent while Nifty Smallcap 50 was down 0.84 per cent. The S&P BSE Midcap was down 0.22 per cent while the S&P BSE Smallcap was down 0.33 per cent.