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Stock markets extended losses to a fifth straight day on Tuesday, as investors were worried about recent foreign institutional selling in the wake of the start of Fed’s stimulus tapering. After selling to the tune of Rs 271 crore in the last two trading days, foreign institutional investors offloaded shares worth about Rs 567 crore on Tuesday, according to provisional data. In 2013, overseas investors had bought shares worth Rs 1,11,920 crore ($ 20 billion)
With domestic investors, too, remaining cautious about the stock markets’ outlook, concerns have heightened markets could drift lower in the near term. Domestic institutional investors net bought shares worth Rs 59 crore on Tuesday. Both benchmark indices have fallen on all the days of 2014 so far, clocking losses of over two per cent since December 31. The BSE Sensex fell 94.06 points or 0.45 per cent to close at 20,693.24. The NSE’s Nifty dropped 29.20 points or 0.47 per cent to close at 6,162.25.
Analysts said it would be important for the Nifty to hold above the support level of 6,129 during the week. “If 6,129 is broken, bears will take the charge of the market. In that case, the Nifty could fall to 5,900 levels where the market is having support of 200 days SMA,” said Shrikant Chouhan, head-technical research, Kotak Securities.
Brokers said the next key trigger for the markets would be the October-December results, which will give investors a sense of whether the worst is over for companies.
“By looking at index movement since the beginning of the new year, it seems that market participants are now waiting for earning season to start and accordingly they’ll plan their bets,” said Jayant Manglik, president-retail distribution, Religare Securities.
Infosys, India’s second largest software exporter, will flag off the earning season for top companies on Friday. Infosys shares fell 1.6 per cent to close at Rs 3457.40 on Tuesday. The CNX IT Index was down 1.2 per cent.
Small-cap shares managed to hold ground in a weak market on Tuesday. BSE’s Small-cap Index rose almost 0.4 per cent.
