Banks and auto stocks cap Sensex gains, Nifty tests 16,550; TechM rises 1% - Economic Times

NEW DELHI: Benchmark indices fell on Tuesday from record levels after six days of gains, while weakness across the broader market continued amid lack of directional cues. Asian peers were largely mixed as investors feared a rise in virus cases globally. Record closing for US stocks overnight could not add much to investor confidence.

At 1.20 pm, the NSE Nifty50 was trading at 16,523, down 40 points or 0.24 per cent. The 50-pack index had risen in the past six sessions and technical charts were hinting at an overbought situation. The BSE Sensex, which gained in the previous three sessions, declined to 55,509, down 74 points or 0.13 per cent. The index was down over 150 points in opening trade, thanks to selling in banking shares.

V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said that the market is slowly moving into a consolidation phase.

The current trend of largecap outperformance, he said, is likely to continue in the very short term. "There are no major global cues that can sway the market trend. But domestic cues like the sustained decline in Covid cases and economic activity returning back to normal are positives. Valuations are stretched and scary but there is enough momentum in the market to take the Nifty to 16,700 level. It appears that the phase of easy money-making is over. Day trading is likely to turn risky," he said.

Midcap and smallcap indices traded almost flat.

"The focus clearly has shifted to a few largecap names since the last few days, which has kept the index buzzing. But the midcap and the smallcap space is lacking such momentum. Immediate supports for Nifty50 are placed around 16,460 and 16,400, while levels around 16,600 and 16,700 will be considered as immediate resistances. Since there are no reversal signs on the index, one should avoid taking contra calls and rather be very selective in picking stocks for trading. Traders should avoid leveraged positions and also book timely profits on long positions," said Samit Chavan of Angel Broking.

IndusInd Bank declined 1.25 per cent to Rs 1,005.90. HDFC Bank declined 0.93 per cent, ICICI Bank fell 0.81 per cent, while Suzuki dipped 0.80 per cent. Axis Bank, HDFC and Larsen &Toubro edged lower. rose 2.91 per cent to Rs 1,407.40. Sun Pharma, Asian Paints and Nestle India added over 1 per cent each.

Asian markets were trading mostly lower, giving up early gains. MSCI's broadest index of Asia-Pacific shares outside Japan was down by 0.45 per cent.

Korea’s Kospi declined 0.60 per cent; Australia's ASX 200 tanked 0.76 per cent; Hong Kong’s Hang Seng fell 0.03 per cent; China’s Shanghai Composite index added 0.17 per cent while Japan's Nikkei gained 0.08 per cent.

US stock indices closed at record highs overnight. Dow Jones climbed 0.31 per cent to 35,625.40, S&P500 index gained 0.26 per cent to 4,479.71 and Nasdaq Composite declined 0.20 per cent to 14,793.76.

Oil prices rose, recovering from the previous day's losses, as investors sought bargains and on expectations that major producers will not boost supply soon, though fears of weaker global demand amid surging pandemic capped gains. Brent crude was up 13 cents, or 0.2 per cent, at $69.64 a barrel.

Opto Circuits India and Kumaka Industries are among the companies that will announce quarterly earnings today.

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Banks and auto stocks cap Sensex gains, Nifty tests 16,550; TechM rises 1% - Economic Times
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