Mid-day Mood | Sensex, Nifty tumble as profit-booking drags heavyweights

The market rally lost steam as the Sensex and the Nifty inched lower in the afternoon trade on February 26, with investors rushing to book profits in heavyweight counters like TCS, Infosys, RIL, ICICI Bank, Axis Bank, and ITC.

The market had opened lower despite positive global cues and extended losses as the day progressed after profit-booking picked pace.

Around noon, the Sensex was down 427.06 points, or 0.58 percent, at 72,715.74, and the Nifty was down 123.30 points, or 0.56 percent, at 22,089.40. Losers also outnumbered gainers, as about 1,524 shares rose, 1,860 fell and 111 were unchanged.

The broader market were also trading with losses as the BSE midcap index was down 0.6 percent and the BSE smallcap index 0.1 percent.

Sectoral Trends

Most sectoral indices except media were in the red. Information technology stocks were the worst hit, with the Nifty IT falling nearly 2 percent. Other sectors such as banks, both private and public, realty, pharma, FMCG, energy, infra and metals were also struggling with losses.

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Fundamental View

"An interesting feature of the FPI trend recently is the decline in FPI equity outflows despite the rising bond yields in the US. Normally, when the US 10-year yield rises above 4.15 percent, the FPIs sell heavily. But this is not happening now," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services. Since the domestic institutional investors (DIIs), high networth individuals (HNIs) and retail investors are the dominant players now and sustained buying by them is pushing the market to newer records, foreign portfolio investors (FPIs) have taken a backseat, he said.

He also said market resilience is preventing FPIs from selling aggressively despite attractive bond yields in the US.

Technical View

According to Deven Mehata, research analyst of Choice Broking, the Nifty can find support at 22,150 followed by 22,100 and 22,050. On the higher side, immediate resistance is at 22,300 followed by 22,350 and 22,450.

"The charts of Bank Nifty indicate that it may get support at 46,600, followed by 46,500 and 46,400. If the index advances, 47,200 would be the initial key resistance, followed by 47,300 and 47,500," he added.

Key Nifty gainers

Larsen & Toubro, Adani Enterprises, Power Grid Corp, Adani Ports and SBI Life

Key Nifty losers

Asian Paints, Hindalco, Divi's Labs, Apollo Hospitals and Infosys

Key Sensex gainers

Larsen & Toubro, M&M, Power Grid Corp

Key Sensex losers

Tata Steel, Infosys, and Asian Paints

Stock moves

Alkem Labs: Shares nosedived 10 percent following reports that the income tax department found large-scale tax evasion.

Asian Paints: Shares slumped 4 percent as brokerages issued a cautious outlook for the paint-maker, anticipating increased competition within the industry with the foray of Grasim's Birla Opus.

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