Riding on the bounceback seen in the afternoon trades, the BSE benchmark index, the Sensex, recovered 239 points from the day's low, and finally settled with a marginal loss of 38 points at 19,545. Earlier in the day, the Sensex had touched a low of 19,307 due to sell-off in frontline stocks. The Nifty, which, recovered nearly 80 points from the lows closed flat with a negative bias at 5,868.
The markets were weak for the larger part of the day due to negative cues from the Asian front. Major indices in our neighbourhood such as Hang Seng and Nikkei were down in the region of about a percent each, thereby having a cascading effect on the trading activity back home. However, the markets retraced most of their losses in late-noon trades as the positive sentiment across the European market front negated the negative influence of the Asian peers. The bounce back was aided mainly by the emergence of selective strength in metal and banking space.
Commenting on the bounceback, Ashish Chaturmohta, IIFL Wealth says, “Markets bounced back due to short covering. Traders who formed short positions in the morning were trapped and their stop losses got trigged as markets began recovering and they were forced to buy to cover their shorts." The smallcap and the midcap indices closed the day virtually unchanged outperforming the Sensex which was down 0.2%
Among the sectoral indices, Health Care index up 0.4% led the gains followed by FMCG, Teck, Metal and Capital Goods indices which reversed earlier losses to close flat. On the other hand, Consumer Durables down 0.8%, Oil & Gas and Bankex indices which shed 0.3% each led the losses.
The draggers in the Consumer Durables space were Videocon Industries and Rajesh Exports down nearly 2% followed by VIP Industries, Bajaj Electricals, Gitanjali Gems and Whirlpool which lost 1% each. Biocon up 2%, Dr Reddys Lab, Orchid Chemicals, Divis Laboratories, Apollo Hospital and Lupin which added 1% each were the movers in the Health care space.
The cement stocks were in the limelight as cement majors ACC and UltraTech posted their quarterly numbers. ACC saw a decline of 10.9% in its net profit for the first quarter while UltraTech Cement, the largest cement firm, with installed capacity of about 49 million tonnes a year saw a 7.2% rise in its net profit. The reaction of the cement stocks were largely positive as only three out of 13 scrips listed on the BSE closed in the negative. The top gainers in this space were Birla Corporation up 5% followed by India Cements, Ultra Tech Cements which added 2-3%.
Among the top gainers on the Sensex were Bharti Airtel (Rs 381), Hindalco (Rs 222), Tata Motors (Rs 1261), Reliance Communications (Rs 106) and Jindal Steel (Rs 696)up 1% each.
The Sensex losers for the day were Hindustan Unilever(Rs 283) and Maruti Suzuki (Rs 1301) down nearly 2% each followed by Sterlite (Rs 183), Reliance Infrastructure (Rs 683), Mahindra & Mahindra (Rs 756), DLF (Rs 238) and HDFC Bank (Rs 2360) which shed 1% each.
The market breadth was negative. Of the total 2977 stocks traded on the BSE, 1570 stocks declined while 1286 advanced.
