Saturday blues: Exchanges see 30% drop in trading volumes, shows data

Market players said muted participation from institutional investors weighed on the activity, with several counters logging muted volumes

Trading volumes on the bourses were down by 30 per cent on Saturday as exchanges tried to squeeze in the full session to 

make up for the special holiday declared on Monday on account of the inauguration of the Ram temple in Ayodhya.

The combined turnover (NSE and BSE) for the cash segment stood at Rs 84,574 crore, 28 per cent lower than the average daily turnover (ADTV) of Rs 1.17 trillion recorded for this month.

The equity derivatives volumes stood at Rs 303 trillion (notional turnover) versus this month’s average of Rs 456 trillion.

Market players said tepid participation from institutional investors weighed on the activity, with several counters logging muted volumes.

The volumes would have been even lower had the weekly expiry for S&P BSE Bankex derivatives not shifted from Saturday from Monday.

“Even though the US markets rose sharply (on Friday) domestic markets exhibited a subdued trend influenced by extended holidays, low volumes, and weekly option expiration,” said Vinod Nair, Head of Research, Geojit Financial Services.

After witnessing a 714-point swing for the day, the 30-share pack Sensex closed at 71,424, down 260 points, or 0.4 per cent, while the Nifty ended the session at 21,572, down 51 points, or 0.23 per cent on Saturday.

The broader markets outperformed with the midcap index hitting a new record high. The Nifty midcap 100 closed at 48,063, with a gain of 0.52 per cent and the Nifty smallcap 100 index rose 0.2 per cent to 15,519.

Shares of Hindustan Unilever fell 3.7 per cent — the most among the Sensex and Nifty components—after the FMCG majors’ December quarter earnings failed to meet Street’s expectations.

The shares of Reliance Industries also reacted negatively to its earnings, falling 0.8 per cent. Analysts said these companies and other blue chips such as ICICI Bank would remain in focus on Tuesday as large investors react to their numbers.

Earlier, exchanges had planned two special trading sessions on Saturday to test their disaster recovery site (DRS). However, with the state of Maharashtra—where the exchanges are located—declaring a holiday on Monday, they decided to conduct a full session.

Market players said the domestic institutional investors (DIIs) and foreign portfolio investors (FPIs) punched only a fraction of trades than they normally do and 

retail, high net-worth individuals and proprietary traders dominated the activity. 

FPIs were net sellers to the tune of Rs 546 crore, while DIIs sold shares worth Rs 719 crore in the cash segment.