An intense wave of selling on May 5 in banking, metals and financial services names hammered the market, which closed over a percent lower from the previous day. Investor wealth, reflected by the market cap of listed companies, eroded by Rs 1.42 lakh crore.
Heavyweight HDFC twins were the biggest casualties of the day, tumbling nearly 6 percent each amid reports that the merger of the two may result in an outflow of $150-$200 million following MSCI changes.
The BSE flagship Sensex closed 694.96 points, or 1.13 percent, down at 61,054.29 and the Nifty sank 1.02 percent, or 186.80 points, to 18,069.
“While the overall market structure remains positive, expect Nifty to consolidate in the near term on the back of subdued global cues and profit booking in index heavyweights. Next week market would also take cues from inflation, state election outcome and ongoing earning season,” said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services.
Stocks and sectors
In the Nifty 50 index, Titan was the biggest gainer – rising 2.31 percent – followed by Maruti Suzuki, UltraTech Cement and Nestle India. Apart from HDFC twins, IndusInd Bank, Hindalco Industries and Tata Steel were major losers.
Most sectoral indices ended lower. Nifty Bank and Nifty Financial Services lost more than 2 percent each. Nifty Media and Nifty Metal fell over a percent as well. Nifty FMCG was the only gainer.
Broader market also saw selling but the intensity was lower. Nifty Smallcap 100 closed down by 0.82 percent while Nifty Midcap slipped 0.7 percent.
| Index | Prices | Change | Change% |
|---|---|---|---|
| 61,054.29 | -694.96 | -1.13% | |
| Nifty 50 | 18,069.00 | -186.80 | -1.02% |
| Nifty Bank | 42,661.20 | -1,024.25 | -2.34% |
| Biggest Gainer | Prices | Change | Change% |
|---|---|---|---|
| Titan Company | 2,732.90 | 62.50 | +2.34% |
| Biggest Loser | Prices | Change | Change% |
|---|---|---|---|
| HDFC Bank | 1,625.65 | -102.15 | -5.91% |
| Best Sector | Prices | Change | Change% |
|---|---|---|---|
| Nifty Auto | 13345.80 | 53.30 | +0.40% |
| Worst Sector | Prices | Change | Change% |
|---|---|---|---|
| Nifty Bank | 42661.20 | -1024.20 | -2.34% |
OUTLOOK for May 8
Prashanth Tapse, Senior VP (Research), Mehta Equities
Markets were under a bear hug on the back of a massive profit-taking amid sell-off in HDFC twins, US banking woes and weak Wall Street cues. Traders will get their first chance to react to US April jobs data to trickle in this evening. Expect a volatile session with Nifty’s major hurdles seen at 18300, while the support to watch out will be at 17971 mark.
Ajit Mishra, VP - Technical Research, Religare Broking
The decline in the index has faded the bullish tone and indications are now in favor of consolidation. On the index front, Nifty has major support at 17,850 so any dip towards that mark may prompt fresh buying. We feel banking and financials may take a breather after the phenomenal performance so the focus should be on other sectors for long trades.
Rohan Patil, Technical Analyst, SAMCO Securities
The weekly momentum indicator still has a positive crossover, a buy signal. We believe that the uptrend is still intact, and this dip should be used as a buying opportunity. Technically the trend for the Nifty is bullish on the broader time frame and buying on every dip can be a profitable strategy. The support for the index is placed at 17,800 levels and the upper band of the index is capped at 18,350 – 18,400 levels.