Localised lockdowns weigh; Sensex declines 244 points amid volatility

The broader markets, however, managed to duck the bear onslaught and supported the overall market breadth

MARKETS: Indices at day's low; Sensex tanks 250 pts, Nifty below 14,300

Stock market updates: A sharp sell-off in the fag-end of the session engulfed markets on Tuesday as incidents of localised lockdowns increased in the country. The economically important state of Maharashtra tightened Covid-19-related curbs, allowing shops to stay open only between 7 AM and 11 AM, while eastern state of Jharkhand announced a complete lockdown for a week, starting Wednesday.

Amid this, the BSE barometer Sensex dropped over 1,000 points from day's high to hit a low of 47,438 in the intra-day trade as investors dumped IT, financials, and heavyweights like Reliance Industries, HUL, and Ultratech Cement.

The index, however, staged a mild recovery to eventually close at 47,706 levels, down 244 points or 0.5 per cent, with Ultratech Cement, HCL Tech, HDFC, Tech M, HUL, ITC, and HDFC Bank leading the list of losers. All these stocks declined between 1 per cent and 5 per cent.

On the NSE, the 50-share index hit an intra-day low of 14,207 before settling at 14,296 levels, down 63 points or 0.44 per cent. About 27 of the 50 constituents ended the day in the red. Bucking the trend were players like Dr Reddy's Labs, Bajaj twins, HDFC Life, Bajaj Auto, M&M, Maruti Suzuki, and Tata Consumer Products, rising up to 3.5 per cent.

The broader markets, however, managed to duck the bear onslaught and supported the overall market breadth. The S&P BSE MidCap and SmallCap indices gained 0.5 per cent each. Overall market breadth was tilted towards bulls with 1,654 stocks advancing on the BSE as against 1,228 stocks that declined.

Sectorally, the Nifty IT index, down 1.4 per cent, faced the hardest knock amid weakness in global tech stocks. That apart, the Nifty FMCG and Bank indices ended 0.64 per cent and 0.35 per cent lower, respectively.

On the upside, the Nifty Pharma index ended 1.3 per cent higher at 13,427 after hitting record high of 13,522 (up 2 per cent) in the intra-day trade. Individually, Cipla, Gland Pharma, JB Chemicals and Pharmaceuticals, Max Healthcare, Neuland Laboratories and Apollo Hospital Enterprises hit their respective record highs today while Sun Pharmaceutical Industries, Cadila Healthcare, Glenmark Pharmaceuticals, Panacea Biotech and RPG Lifesicenes hit 52-week highs in the intra-day trade as the Indian government will open up vaccination to anyone over 18 years of age starting May 1. READ MORE

Note: Domestic markets shall remain shut on Wednesday, April 21, on account of Ram Navami holiday

Global markets

Global shares edged further back from record highs on Tuesday as lofty sovereign bond yields and rising global COVID-19 cases had investors questioning high equity valuations. MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.2 per cent but Japan’s Nikkei dropped 2 per cent on worries that the possible reintroduction of Covid-19 emergency measures in the country’s biggest cities would slow the economic recovery.

In Europe, the UK’s blue-chip FTSE 100 fell 0.4 per cent, Germany’s DAX was down 0.1 per cent and France’s CAC 40 declined 0.7 per cent. The pan-regional STOXX 600 index dropped 0.5 per cent.

(With inputs from Reuters)

5:15 PM

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

The lack of strength to sustain the highs continued in the market and the Nifty is now placed at the crucial support juncture of around 14200-14150. The chances of downside breakout seems higher. A decisive below the support is likely to drag Nifty down to 13500 levels in a quick period of time. Any upside bounce from here could find strong resistance around 14370.

5:08 PM

MARKET CLOSING COMMENT :: Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel Broking

Market is struggling at higher levels and today’s session is a clear indication of this as it failed to sustain despite a strong start. Today’s high precisely coincided around the mentioned resistance zone of 14500 – 14550 and the way it dropped towards 14200 in the latter half, things do not bode well for the bulls. Although we did manage to hold this key support today, the possibility of sliding below it, has increased now. Below 14200, it opens up the downside zone of 14000 – 13700 and hence, we continue to remain cautious and advise against creating aggressive longs for a while. Today barring Pharma, most of other sectors looked weak in the latter half. Thus one need to be very watchful while picking up a stock specific trade

5:01 PM

MARKET CLOSING COMMENT :: Mohit Nigam, Head, PMS & Advisory at Hem Securities

Markets opened higher this morning on positive news about mass vaccination drive from May 1 onwards. However, it failed to sustain the higher levels in the second half due to weak Europe & US markets. Moreover, the continuous negative developments related to Covid from different parts of the country is acting as the single most dominant factor leading to the decline. Strong positive momentum is seen in the pharma space since the past few days & we can look in this space for short term opportunities. A withdrawal of Rs.5,000crs by FIIs in the month of April might indicate changing sentiments of foreign funds coming into India in the current scenario. 14200 levels continue to remain a support & if the market breaches that, then we can see a 500–700 points dip in Nifty quickly

4:50 PM

MARKET CLOSING COMMENT :: Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Sec

The market registered an extremely volatile session, the nifty/ Sensex closed 63/243 points lower. Post yesterday sharp fall today, the Nifty/ Sensex opened with over 150/ 500 points gap up but after a strong opening, it failed to sustain above 14500/48400 resistance mark and due to consistent selling pressure at higher levels along with tepid global cues the benchmark index corrected sharply . Among sectors, profit booking was seen in IT stocks whereas, Auto, Pharma and selective Media stocks witnessed buying interest. We are of the view that, currently the nifty / Sensex hovering in the range of 14600 to 14400/ 47500-49000 price range and the texture of the pattern suggest narrow range activity likely to continue in the near future. Technically, the index has formed a lower top formation which is broadly negative for the market. The intraday chart suggest correction wave likely to continue if the nifty/ succeed to trade below 14400/48100 below the same the correction wave will continue up to 14200-1413/ 47350-47000 On the flip side, above 14400/48100 we can expect quick pullback rally till 14475-14525/ 48300-48500

4:39 PM

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

Indian Benchmark equity indices extended their decline to a second session even as Maharastra added to lockdown-like curbs amid rampant Covid cases. The Nifty opened higher and kept falling through the day with the downfall accelerating post 1415 Hrs. At close, the Nifty was down 63.10 points or 0.44% at 14,296.40. The broader markets did better with the S&P BSE MidCap and S&P BSE SmallCap indices both ending 0.5% higher.

Volumes on the NSE were in line with recent averages. Among sectors, Pharma and Auto gained the most, while IT and Materials indices fell the most.

Nifty once again failed to hold on to higher levels facing selling pressure. However the broader market did well on April 20. It took support again from 14207. However repeated testing of 14200 is not a good sign. 14200-14505 is the new band for the Nifty for the near term. A breach of 14200 again could result in accelerated selling.

4:29 PM

TECH VIEW :: Sumeet Bagadia, Executive Director at Choice Broking

Technically, the Nifty index has formed Bearish Marubozu Candlestick on the daily chart, which indicates more bearishness in the index for the near term. Moreover, the Nifty index has been hovering below 50 days EMA from the last couple of days and also trading below the neckline of Double Top pattern, which suggests more downside move below the levels of 14200. At present, the Nifty index may find immediate support at 14000 levels, while on the upside, 14500 would be the resistance zone.

4:19 PM

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

Index opened a day with a strong gap but profit booking from highs led the index to close in the negative note at 14294 with loss of half per cent and formed a strong bearish candle on the daily chart. The index has base around 14200-14250 zone if managed to sustain then some pullback possible if not saved then we may see next leg of a move towards 14000 marks which is another strong support on the downside, on the higher side 14400-14500 will be stiff hurdle also can be considered as initial profit booking levels

4:09 PM

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

Indian markets witnessed a bounce-back in its opening trade, however, failed to hold onto its early gains due to weak global cues and the possibility of a stricter lockdown in Maharashtra. Despite the vaccine drive kindling hopes of recovery, the trend in the market will depend on positive developments like decreasing covid cases and lifting restrictions. IT and FMCG were the sectoral laggards while mid and small-caps outperformed

3:55 PM

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

In a volatile session today with news flow on the virus as well as the vaccine playing in the minds of investors we witnessed yet another day when Pharma stocks ruled high. Cement stocks came under a bout of profit booking today while the broader markets witnessed keen investor appetite for Insurers

3:51 PM