Sensex falls over 300 points, Nifty trades below 19,300; Shoppers Stop, Jio Financial Services down up to 11%; Gabriel India jumps 8%

Indian equity benchmarks traded lower in early trade on Friday, dragged by technology, pharma, consumer goods and bank stocks. The 30-share BSE Sensex slipped 320 points or 0.49 per cent to trade at 64,932, while the broader NSE Nifty was down 100 points or 0.52 per cent to trade at 19,287. Mid- and small-cap shares were down as Nifty Midcap 100 fell 0.26 per cent and small-cap shed 0.01 per cent. Market participants turned cautious after the Reserve Bank of India's (RBI's) policy meeting minutes flagged inflation risks.

On the global front, Asian markets declined today. Overnight, Wall Street equities closed lower as investors await Jerome Powell's speech at the Jackson Hole symposium, due later today, for cues into the US Federal Reserve's future rate trajectory.

"The message from the Fed chief Powell tonight will be keenly watched for any clues on the future trajectory of interest rates in the US. The Fed chief is unlikely to indicate that the rate hiking cycle is coming to an end. An unhealthy trend in the market is the sustained rise in the prices of many small-and micro-cap stocks. This is partly aided by the sustained flow of funds into the small-cap segment. Valuations in the segment are approaching risky levels. Safety is now in large-caps," said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Foreign institutional investors (FIIs) bought shares worth Rs 1,525 crore on a net basis during the previous session, while domestic institutional investors (DIIs) bought shares worth Rs 5,797 crore, according to provisional National Stock Exchange data.

13 out of the 15 sector gauges -- compiled by the NSE -- were trading in the red. Sub-indexes Nifty IT, Nifty Pharma, Nifty FMCG and Nifty Bank were underperforming the NSE platform by falling as much as 0.78 per cent, 0.75 per cent, 0.57 per cent and 0.63 per cent, respectively.

On the stock-specific front, Jio Financial Services was the top loser in the Nifty pack as the stock cracked 4.99 per cent to trade at Rs 202.80. Dr Reddy's, IndusInd Bank, L&T and Sun Pharma fell up to 1.56 per cent.

In contrast, Bajaj Finance, Bajaj Finserv, Reliance Industries, BPCL and HDFC Life were among the top gainers.

The overall market breadth was positive as 1,603 shares were advancing while 1,240 were declining on BSE.

On the 30-share BSE index,  HDFC Bank, Reliance Industries, Hindustan Unilever, Infosys, Airtel, Kotak Mahindra Bank and Tata Consultancy Services (TCS) were among the top laggards.

Also, Shoppers Stop, Welspun Enterprises, Bajaj Hindusthan Sugar, Aarti Drugs and Trent tanked up to 10.66 per cent. On the other hand, Gabriel India, JP Associates, Texmaco Rail, KPI Green Energy and Astra Microwave jumped up to 7.63 per cent.

On Thursday, Sensex had slipped 181 points or 0.28 per cent to settle at 65,252, while Nifty had moved 57 points or 0.29 per cent down to end the session at 19,387.

Nifty outlook

"Rejection trades emerged as feared, on reaching the extended target of 19,570 yesterday. The surprising depth of the pull back has renewed the prospects of 19,060-18,900 or even 18,600-18,300, as the downside objectives, but we pin our hopes on the 19,280 regions to step in and offer bargain buying support today. A direct fall below 19,250 or inability to reclaim 19,420 will signal resumption of the 18,300 slides," said Anand James, Chief Market Strategist at Geojit Financial Services.

 

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