Domestic equity indices ended the session with big cuts on Wednesday as negative news flow at both domestic and global levels triggered the sell-off amid F&O expiry of January series contracts. Indian stock markets will remain shut on Thursday on the account of Republic Day and trading will resume from Friday.
Fears of recession as well as pessimistic growth forecast for US dampened the mood at the Dalal Street. Alarming news for Adani Group stocks soured the sentiments further. The intense sell-off at the Dalal Street made investors poorer by Rs 3.6 lakh crore for the day.
For the day, BSE Sensex plunged 773.69 points or 1.27 per cent to 60,205.06, whereas NSE's Nifty50 Index settled at 17,891.95, falling 226.35 points or 1.25 per cent. BSE midcap and smallcap indices dropped up to 1.5 per cent, while the fear gauge India VIX spiked over 7 per cent to 14.66-level.
Bears remained at the helm as the benchmark index Nifty shed more than 200 points on Wednesday. On the daily timeframe, it remained below the 50-day exponential moving average. Besides, the index remained below the 50-day exponential moving average, which confirms the bearish trend, said Rupak De, Senior Technical Analyst at LKP Securities.
"On the lower end, however, the correction was limited to the upper band of the falling wedge pattern on the daily chart. The sentiment looks very weak, with the RSI in a bearish crossover. However, a further correction may occur if the price falls below 17,840. On the higher end, resistance is placed at 18,000," he said.
All the sectors of Nifty were hit hard amid the sell-off in the broader markets. Banking stocks bled the most, followed by a 2 per cent drop-in financial services and realty counters. Pharma, media and IT indices ended a per cent lower each.
Adani Group stocks were the beaten down the most. On Nifty50 pack, Adani Ports tanked more than 6 per cent, whereas other listed entities led by Gautam Adani tumbled up to 8 per cent during the day after negative report by Hindenburg Research.
A report by short seller Hindenburg suggesting seven of the Adani group listed companies have an 85 per cent downside potential on a fundamental basis due to sky-high valuations, Reuters reported. However, Adani Group claimed the reports to be malicious.
Among other blue-chip indices, SBI and IndusInd Bank declined 4 per cent each, whereas HDFC Bank shed 3 per cent. HDFC, Cipla, Axis Bank, Tech Mahindra, Apollo Hospitals, Ultratech Cement, ICICI Bank and Larsen & Toubro were down 2 per cent each. Bajaj Auto and HUL topped among the gainers, followed by Hindalco, Britannia, Maruti Suzuki and JSW Steel.
Indian equities witnessed significant sell-off as the market appeared apprehensive ahead of the upcoming Union Budget and Fed meeting next week, said Vinod Nair, Head of Research at Geojit Financial Services.
"Sentiments were dampened by persistent FII selling, where funds are being shifted to other EMs as a result of attractive valuations. Furthermore, a weak economic growth outlook that stoked recession fears pulled down global markets," he said.
A total of 3,646 stocks that traded for the day on BSE, of which 2,387 settled lower, while 1,128 settled higher. Remaining 131 stocks ended unchanged. A total 173 stocks hit an upper circuit on BSE, whereas 193 stocks hit the lower circuit during the trading session.
In the broader markets, Accelya Solutions Indian plunged 12 per cent, whereas Kiri Industries plunged 9 per cent. Zomato, Adani Transmission, Quick Heal, Ambuja Cement and Indus Tower plunged 8 per cent each. ACC, Power Mech and Granules India were other key losers.
Mahindra CIE Automotive, Saregama India, Venus Remedies, Bliss GVS Pharam surged 7-9 per cent each. South Indian Bank, Manksia, Sagar Cement, KIOCL, Sona BLW Precision and TVS Motors advanced 5-6 per cent each despite the weakness in the broader markets.
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