Sensex, Nifty decline one per cent as investors book profit at peak
NEW DELHI: Domestic equity market fell sharply on Friday, ending deep in the red amid broad-based profit booking at record high level. Benchmark index BSE Sensex shed 733 points, or 0.98%, to end at 73,878 while Nifty50 closed the session 173 points or 0.76% lower at 22,476.
The Sensex had plunged 1,143 points intraday to hit the day’s low of 73,468, while the Nifty50 fell below the 22,350 mark. “Profit booking and a degree of caution ahead of the release of the US non-farm payroll resulted in selling pressure in the market. However, the absence of significant negative surprises in Q4 earnings thus far, along with a decline in oil prices, might help to mitigate the downside,” said Vinod Nair, head of research, Geojit Financial Services.
Nair added that though the correction was broad-based, the large-cap stock was the key underperformer due to the moderation of FII’s exposure to the domestic market. Foreign institutional investors’ net sales from local equities stood at 2,392, as per provisional NSE data.
Twenty-four of the 30 Sensex stocks, and 35 of the 50 Nifty shares closed in the red on Friday, led by L&T, Maruti Suzuki, Reliance Industries, Nestle India, JSW Steel, and Bharti Airtel. In the broader markets, BSE MidCap and SmallCap indices declined 0.2% and 0.55%, respectively. The overall market capitalisation of BSE-listed firms fell more than Rs 2.3 lakh crore to nearly Rs 406.2 lakh crore.
Prashanth Tapse of Mehta Equities said geopolitical tension would make headlines again giving traders an option to go short on markets.
“Overall, the Q4 earnings are ranging from neutral to positive and are not particularly impressive. There are some reports indicating that Foreign Institutional Investors (FIIs) have decreased their holdings in large-cap stocks such as HDFC Bank and
ITC. In the short term, the trend remains cautious, with the focus shifting towards new geopolitical developments. Hence, we advise traders to remain light on positions,” added Tapse.
