Mumbai, Nov 13: Heavy selling pressure in the final hours of trade, amid higher oil prices and weak rupee, dragged benchmark indices lower.
The Indian currency opened on a weaker note, largely on the back of crude price rise as well as pressure seen on India’s fiscal deficit post Friday’s GST announcements. Experts estimates the GST-led hit to be around Rs 20,000 crore for the economy.
The weaker rupee, boosted stocks such as Tata Consultancy Services in an otherwise negative market. The weak rupee could have boosted some of the other IT stocks as well.
Meanwhile, the Street also kept an eye on crude movements, seen as one of the triggers for the correction that seems to be setting in on the market. Additionally, economic data such as IIP was on investors’ radar as well.
“Both the benchmark Sensex and the Nifty finally closed the day with losses of over 0.5%. The weak domestic sentiment was exacerbated by disappointing macro-economic data. India’s index of industrial production (IIP) rose 3.8% in September 2017 over September 2016. This was at a slower clip compared to the IIP growth in August 2017 which was at 4.5%,” Karthikraj Lakshmanan, Senior Fund Manager – Equities, BNP Paribas Mutual Fund said in a statement.
The Sensex closed down 281 points at 33033.56, while the Nifty ended lower by 96.80 points at 10225.00. The market breadth was negative as 1091 shares advanced against a decline of 1635 shares, while 150 shares were unchanged.
Midcaps, meanwhile, ended around 0.45 percent lower after putting up a tough fight through the day.
Market-leading stocks were seen leading the correction. HDFC fell over 2 percent, HDFC Bank also ended in the red. Reliance too was lower by 1 percent.
Banks failed to hold on to gains. State Bank of India cut most of it gains, ended mildly in the green. Axis Bank reversed all of its morning gains and ended over 1 percent lower. ICICI Bank too was lower by about 1.44 percent.
Larsen and Toubro erased some of the losses and ended 2 percent lower as investors reacted to the tepid order inflow guidance.
Metals saw correction and as a result, stocks such as Tata Steel was down 1.5 percent.
The correction also dragged stocks such as Adani Ports despite good Q2 numbers.
Among midcaps, Marksans Pharma was down 14 percent post poor Q2 results, while Idea Cellular lost 4 percent after gaining 3 percent in opening tick as investors reacted to poor Q2 numbers. ARPUs came in lower.
Other stocks such as HDIL, India Cements and IDBI Bank were lower 3-4 percent.
On the gaining side were aviation stocks. SpiceJet and Jet Airways gained around 4 percent. SpiceJet reported good Q2 numbers and that effect spilled over to Jet Airways as well.
On stocks that could be impacted by GST announcement, firms such Jubilant Foodworks, Havells India managed to hold its gains and end in the green
Meanwhile, Godrej Consumer, Nestle India, Century Textiles and Dabur ended in the red due to profit booking.
In the global markets, European stocks were mostly higher Monday as investors focused on earnings, while keeping an eye on tax reform plans in the U.S. and political woes in the U.K.
Asian markets wavered in Monday trade after U.S. stocks closed mostly lower on Friday, with Japan’s Nikkei 225 index ending lower for the fourth straight session.
Going forward, experts see a correction ahead. “DIIs continue to pump money into domestic bourses. The Indian markets are currently more expensive than our Asian peers and we believe this is only the beginning of a much larger correction. We would advise taking short positions at his juncture, with stop losses above 10450,” Nikhil Kamath, co-founder and head of trading, Zerodha said in a statement.