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Benchmark indices are reeling under selling pressure on account of profit booking after strong gains in past few sessions. Defensive sectors like Pharma and FMCG along with IT shares are leading the downslide.
At 14:15 PM, the Sensex was down 198 points at 21,042 and the Nifty was down 44 points at 6,273.
According to Ranak Merchant, Technical Analyst - Strategies, Sushil Financial Services, “Benchmark indices may get into a consolidation / correction zone post a stellar show seen in the recent past with Sensex scaling to new life-highs while Nifty missing the same by a whisker. However, individual stock would continue to outperform the benchmarks. Levels to watch for Nifty would be 6209 (Nifty spot) as support on closing basis.”
On the global front, Asian shares sagged on Tuesday after hawkish comments from China's premier ahead of a key Communist Party meeting, though expectations that the US Federal Reserve will maintain its stimulus for a while limited losses.
The euro continued to languish on rising expectations that the European Central Bank will cut rates further, with a few expecting the ECB to take action as early as its Thursday meeting.
MSCI's broadest index of Asia-Pacific shares outside Japan slipped about 0.2%, though Japan's Nikkei stock average bounced off its lows and managed a 0.2% gain.
Back home, Indian services firms recovered slightly last month from the worst slump in over four years in September but activity still shrank and a shortage of new orders means a rebound looks some way off, a survey showed on Tuesday.
The HSBC Services Purchasing Managers' Index (PMI), compiled by Markit, rose to 47.1 last month from 44.6 in September, which was the weakest reading since April 2009.
Meanwhile, Goldman Sachs upgrades its view on India to "market weight", with a target for the Nifty of 6,900 points.
On the sectoral front, BSE FMCG, Healthcare, IT, TECk and Consumer Durable indices have plunged between 1-2%. However, BSE PSU, Metal and Realty indices have declined by nearly 1% each.
The main losers on the Sensex at this hour include ITC, Sun Pharma, Dr Reddy’s Labs, TCS, Bharti Airtel and Hero Moto, all slumping between 2-3%.
“We suggest investors should stay put in the market with strong set of companies in their portfolio. They should avoid high beta stocks. At all times we need to be careful about the valuation, hence stay away from FMCG stocks,” said Daljeet S Kohli, head of research, IndiaNivesh Securities.
On the gaining side, Coal India, Hindalco, Tata Motors, Tata Steel and Tata Power have gained between 1-2%.
Among individual stocks, Dabur India and ITC lost over 3% each in the FMCG pack. United Breweries, United Spirits, HUL and Godrej Consumer also lost between 1 – 2.5% each.
Shares of Suven Life Sciences were up 3.7% at Rs 58.60 after hitting a 52-week on receipt of two product patents one each from US and Japan corresponding to its New Chemical Entities (NCEs).
Shares of Shree Renuka Sugars were up nearly 3% at Rs 23.25 on reports that Wilmar International, a Singapore-based agribusiness group, has initiated talks to buy a stake in the sugar refiner.
The broader markets continue to outperform the benchmark indices- BSE Midcap and Smallcap indices are up by nearly 1% each.
The market breadth in BSE remains marginally positive with 1,172 shares advancing and ,016 shares declining.
