Sensex sheds 551 pts, Nifty below 19,700 as Middle East crisis worsens

Closing Bell on Wednesday, October 18, 2023: Brent crude futures jumped 3 per cent after Iran called for sanctions and oil embargo against Israel

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Stock market highlights: Indian equities reeled under heavy selling pressure on Wednesday as geopolitical tensions in the Middle East, including Iran's call to impose sanction and the need to implement oil embargo against Israel, pushed up oil prices by 3 per cent.

Besides, hardening of bond yields in India and across the globe took investors away from the riskier assets.

The S&P BSE Sensex shed 551 points, or 0.83 per cent, to settle at 65,877. The Nifty50, on the other hand, shut shop at 19,671, down 141 points or 0.73 per cent.

Bajaj Finance declined 2.9 per cent after its Q2FY24 results, and closed as the top large-cap laggard. Axis Bank, Bajaj Finserv, BPCL, Tata Consumer Products, HDFC Bank, LTIMindtree, NTPC, Reliance Industries, IndusInd Bank, Tech M, Kotak Bank, Wipro, Adani Ports, ICICI Bank, JSW Steel, and Apollo Hospitals were the other top draggers, down between 0.8 per cent and 1.7 per cent.

On the upside, Cipla, Dr Reddy Labs, Tata Motors, Sun Pharma, SBI Life, and Bajaj Auto gained up to 3.5 per cent.

In the broader markets, the BSE MidCap index fell 0.85 per cent, while the BSE SmallCap index shed 0.32 per cent.

Sectorally, the Nifty Pharma and Media indices managed to scalp gains of 0.78 per cent and 0.27 per cent, respectively. On the flipside, the Nifty Bank, Financial Services, PSU Bank, and Private Bank indices fell over 1 per cent each.

4:15 PM

Tech View :: 'Consolidation in Nifty getting over; track these levels'

Nifty50
On the daily charts, we can observe that Nifty has faced resistance from around the 61.82% fibonacci retracement level (19,850 – 19,885). On account of the correction , the Nifty has now reached the zone of 19,670 – 19,640 where support in the form of 20- and 40-day moving averages are placed.

Bollinger bands are contracting, indicating that consolidation is likely over the next few trading sessions. In terms of levels, 19,640 – 19,600 shall act as a crucial support and 19,770 – 19,800 is an immediate hurdle zone for the Index.

Bank Nifty

Bank Nifty witnessed a sharp correction and in the process of retesting the previous swing low (44,800). The fall appears overstretched on the downside and is also around support of the daily Bollinger band placed in the zone 43,800 – 43,700 which increases the probability that the fall might not worsen from current levels. Signs of a positive divergence on the daily charts are developing however it needs to be confirmed by price. Overall, we expect the Bank Nifty to witness a pullback over the next few trading sessions.

Views by: Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas

4:07 PM

Comment :: 'Maintain hedged positions'

Fresh weakness in banking and financial majors combined with a downtick in other heavyweights like Reliance is pointing towards further slide. On the index front, a decline below 19,600 in Nifty would again turn the bias on the negative side. We suggest maintaining hedged positions and advise keeping a check on position size citing the prevailing choppiness.

Views by: Ajit Mishra, SVP - Technical Research, Religare Broking

4:05 PM

Comment :: 'Weak global cues, disappointing early Q2 nos leading to profit booking'

Profit booking ensued in Indian markets, spurred by weak global sentiments and escalating Middle East tensions. A sudden rise in the tension has led to instability in energy prices; Brent prices rapidly rose above $92.5 by the day’s closing time. While the US bond yields was cautiously placed, awaiting the FED chair’s speech.

The initial Q2 earnings disappointments by the IT & financials sector may have prompted attention in the domestic markets. All these all factors are presumed to be a knee jerk reaction as the total outlook on domestic market is stable, underpinned by healthy Q2 result forecast and favourable fiscal position.

Views by: Vinod Nair, Head of Research at Geojit Financial Services.

4:03 PM