Covid scare, rise in bond yield spook mkts for 5th day; Sensex dips 585 pts

Stock market updates: Markets came-off sharply in the noon deals on Thursday as US Treasury yields recorded a steep uptick of 5 per cent, causing equity holders to unwind their long positions. Besides, a single-day increase of over 35,800 Covid-19 cases, the highest since December 6, 2020, made market participants question the sustainability of the economic recovery.

Domestic indices started gap-up and extended their rally to clock gains of 490 points from previous day's closing after the US Federal Reserve projected the US economy would grow by 6.5 per cent in 2021 - the largest annual output growth since 1984. However, the BSE barometer of 30 shares wiped off the gains completely and plunged 1,334 points to hit a six-week low of 48,962 as US bond yields topped 1.7 per cent. 

The S&P BSE Sensex index eventually ended at 49,216.5 levels, down 585 points or 1.2 per cent. On the NSE, the Nifty50 hit an intra-day high of 14,875 but dropped nearly 400 points to hit a low of 14,479. By close, the 50-share index was quoting at 14,558 levels, down 163 points or 1.1 per cent.

This was the indices fifth consecutive session of declines.

HCL Tech, Infosys, Dr Reddy's Labs, NTPC, TCS, Reliance Industries, and Tech Mahindra, all down between 2 per cent and 3.5 per cent, were the top losers on the Sensex. Meanwhile, Divis Labs, GAIL, Hero MotoCorp, Axis Bank, Wipro, and Cipla were the additional losers on the Nifty.

On the upside, ITC, Bajaj Auto, Bharti Airtel, M&M, Maruti Suzuki, ONGC, HDFC, Power Grid, and Bajaj Finance closed as the top gainers.

The broader markets fell in-line with their large-cap counter with the S&P BSE Mid and SmallCap indices sliding 1.3 per cent and 1.6 per cent, respectively at close.

All the key sectoral indices, barring FMCG and Metal, were painted in red with the Nifty IT index, down 3 per cent, leading the list of losers. Shares of information technology companies skid up to 5 per cent lower on the National Stock Exchange in intra-day trade on Thursday on account of profit booking ahead of Accenture's second-quarter fiscal year 2021 (FY21) results later today. Among individual stocks, Infosys and HCL Technologies slipped 5 per cent each while Tata Consultancy Services (TCS), Tech Mahindra, Wipro, Mphasis and Coforge were down in the range of 3 per cent to 4 per cent on the NSE. READ MORE

That apart, the Nifty PSU Bank and Realty indices declined 2 per cent each, while the Nifty Bank, Private Bank, and Financial Services indices slipped 1 per cent each.

Global markets

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.87 per cent, while stocks in China rose 0.74 per cent. Australia’s market bucked the trend and fell 0.73 per cent.

In Europe, Germany’s blue-chip DAX rose 0.7 per cent, France’s CAC 40 was up 0.2 per cent, while UK’s FTSE 100 slipped 0.1 per cent ahead of the Bank of England’s monetary policy decision due later in the day. The wider pan-European STOXX 600 rose 0.3 per cent.

The Nasdaq and S&P 500 futures, however, sank 1 per cent and 0.4 per cent, respectively while Dow Jones Futures were up 0.12 per cent.

(With inputs from Reuters)

4:49 PM

TECH VIEW :: Nagaraj Shetti, Technical Research Analyst at HDFC Securities

The short term trend of Nifty continues to be weak. Having placed at the lower support of 14500 levels, one needs to be cautious for any upside bounce. A decisive move below 14500 levels is likely to open broad based weakness in the market and on such scenario, the Nifty could test 14000 levels in the next week.

4:37 PM

TECH VIEW :: Rohit Singre, Senior Technical Analyst at LKP Securities

Index closed a day at 14585 with loss of nearly one percent and formed a bearish candle on daily chart for the fifth consecutive session. The index managed to hold above 14500 zone which is the immediate support on the downside for coming sessions also any close below 14500 zone may see some pressure but holding above said levels can result in good bounce towards immediate hurdle zone of 14600-14700 zone which immediate hurdle zone on the higher side

4:25 PM

TECH VIEW :: Ashis Biswas, Head of Technical Research at CapitalVia Global Research

Today the market failed to show resilience to stay above the level of 14750. As of now, the short-term technical condition of the market shows that the expected range of the market is likely to be between 14410 and 14900. While it is subject to further price action evolution, it is prudent to wait for volatility to subdue and technical factors to improve before attempting to build short to medium term investments. As such we retain our cautious stance, until further improvement and breakout seen above 14900. 

4:20 PM

MARKET CLOSING COMMENT :: Deepak Jasani, Head of Retail Research at HDFC Securities

ndian benchmark equity indices ended lower in the fifth straight session on March 18. The Nifty started to fall sharply post 1245Hrs. At close, the Nifty was down 163.40 points or 1.11% at 14,557.90. Highest spike to new Covid-19 cases in the past 102 days, rise in U.S. bond yields and weekly options related volatility kept sentiment risk-off.

 

Volumes on the NSE continued to be below recent average. Among sectors IT, Pharma, PSU Bank, Realty fell the most while FMCG, Metals ended marginally in the positive. BSE Midcap and Smallcap indices shed over 1 percent each.

 

Nifty has closed at the lowest since Feb 26, though in terms of intra-day low it has gone below even that. Indian markets continue to perform the worst in the region as resurgence of Covid-19 has led to fears of the momentum in the economy slowing down. A close below 14529 would mean that the Nifty is in the midst of an intermediate correction. 14281-14478 could be the support band for the Nifty while 14639-14696 could provide resistance. 

4:09 PM

MARKET CLOSING COMMENT :: Vinod Nair, Head of Research at Geojit Financial Services

Indian equities pared its early optimism and fell into a sharp correction as US bond yield rose to its highest level since January. Dovish comments from the Fed chief on the strong economic bounce back and continuation of its accommodative stance, could not weigh down the rally in the US bond market.  Indian markets had witnessed higher volatility compared to its global peers as domestic investors turned extra cautious on increasing Covid cases in India & a fall in FII inflows

4:03 PM

MARKET RECAP :: S Ranganathan, Head of Research at LKP Securities

With US 10-year yield hitting their highest level in over a year, bears held the upper hand on Thursday even as the FED kept rates unchanged. Selling in Financials kept markets in the red with broader markets seeing profit booking in IT & Pharma stocks ahead of the FTSE rebalancing tomorrow

4:01 PM

IPO Update

>> Nazara Tech subscribed 9.8x on Day 2

>> Suryoday SFB subscribed 83% on Day 2

>> Kalyan Jewellers subscribed 2.5x on final day

Note: Update till 3:50 pm

3:55 PM

SECTOR WATCH :: Pharma stocks the the list of losers

3:53 PM

SECTOR WATCH :: Nifty IT underperforms benchmarks, cracks 3%

3:50 PM

S&P BSE SmallCap index dips 1.6%

3:49 PM

S&P BSE MidCap index dips 1%

3:48 PM

Stocks that dragged the Sensex lower today

3:45 PM

Sectoral trends on the NSE

3:40 PM

Sensex Heatmap at Close

3:35 PM

CLOSING BELL

The S&P BSE Sensex index eventually ended at 49,216.5 levels, down 585 points or 1.2 per cent. On the NSE, the Nifty50 hit an intra-day high of 14,875 but dropped nearly 400 points to hit a low of 14,479. By close, the 50-share index was quoting at 14,558 levels, down 163 points or 1.1 per cent.