Markets Back In Red Ahead Of Key Macro Data

Mumbai: Equity benchmark indices Sensex and Nifty ended lower on Friday, dragged by selling in banking, utility and financial stocks as investors turned cautious ahead of the release of industrial production data. Unabated foreign fund outflows and a depreciating rupee amid geopolitical tensions also hit investors’ sentiment, traders said. However, intense buying in metal stocks amid reports that China will pump more capital in fresh fiscal stimulus to boost its economy restricted the losses, they added. In a volatile trade, the 30-share BSE Sensex fell 230.05 points or 0.28 per cent to close at 81,381.36. During the day, it declined 307.26 points or 0.37 per cent to a low of 81,304.15. A total of 2,143 stocks advanced, while 1,751 declined and 117 remained unchanged on the BSE. The NSE Nifty slipped 34.20 points or 0.14 per cent to 24,964.25. It hit an intraday low of 24,920.05.

Despite volatility in equity benchmark Sensex, the market capitalisation of BSE-listed companies rose by Rs27,796.69 crore to Rs4,62,27,901.66 (Rs462.27 lakh cr or $5.50 trillion).

“The market traded sideways due to a lack of fresh triggers for decisive momentum. The uptick in the US 10-year yield due to the unexpected rise in US core inflation and caution ahead of the result season added layers of sentiment in the market. “The ongoing geopolitical challenges influenced FIIs to shift their focus towards the affordable markets, which is impacting the domestic market liquidity,” Vinod Nair, head (research), Geojit Financial Services.

In the broader market, the BSE midcap and smallcap gauge rose 0.44 per cent each.

“Optimism could return once the earnings season picks up momentum and results are in line with expectations, else the mood could remain cautious with a negative bias in the near to medium term,” added Prashanth Tapse, sr V-P (research), Mehta Equities Ltd.

Investors traded with caution on the last trading day of the week on worries any escalation in the Iran-Israel conflict over the weekend could fuel uncertainty going into the next week.

“European stock markets traded marginally lower Friday, while Asian markets closed mixed, as investors digested a hotter-than-expected US inflation reading ahead of key US bank earnings and a highly-anticipated Chinese fiscal policy briefing,” said Deepak Jasani, head (retail research) at HDFC Securities.

“This week, the market exhibited a mixed trend and ended with a negative bias. The Indian market is currently in a phase of consolidation due to premium valuations and a subdued outlook for Q2 results. In contrast, FIIs are capitalizing on arbitrage opportunities in the Chinese markets, driven by stimulus measures and low valuations. The RBI policy was neutral, as the change in stance does not indicate the likelihood of a rate cut in the near term,” Nair said.