Sensex, Nifty snap 4-day winning streak; CarTrade rises 11%, IEX tanks 8%

Domestic equity markets snapped the four-day winning streak and settled lower on Thursday as traders booked some profit off the table after the RBI kept the interest rates unchanged. However, mixed global cues, arising out of expectations of further interest rate hikes by major central banks, weighed on the sentiments.

For the day, the 30-share pack, BSE Sensex dropped 294.32 points, or 0.47 per cent, to close at 62,848.64, while NSE's Nifty50 declined 91.85 points, or 0.49 per cent, to end the session at 18,634.55. BSE midcap index dropped about a per cent, while smallcap index shed half a per cent. Fear gauge India VIX declined almost 2 per cent to 11.26-level.

A sharp correction in the last hour trade pulled down the Sensex below the 63000 mark, as realty shares faltered sharply after the recent upsurge. While the rate hike pause by the MPC was on expected lines, subdued commentary by the RBI on inflation for this fiscal year dampened the sentiments, said Shrikant Chouhan, Head of Research (Retail), Kotak Securities.

"Technically, on daily charts, the Nifty has formed a long bearish candle, which indicates further weakness from the current levels. However, the medium-term formation of the index is still on the bullish side. For traders, as long as the index is trading below 18,725, the technical correction is likely to continue. The market could slip to 18,600-18,550. Contra traders can take a long bet near 18,550 with a strict stop loss at 18,520," he said.

Barring the Nifty metal index, all the sectoral indices settled lower during the day. Nifty media and realty indices dropped about 2 per cent, each, while Nifty IT, pharma and healthcare indices fell over a per cent, each. Nifty auto, financial services and private bank indices saw significant cuts for the day.

In the Nifty50 pack, Grasim Industries dropped more than 3 per cent, each, while Kotak Mahindra Bank ended 3 per cent down. Sun Pharma, Tata Consumer Products and Tech Mahindra shed 2 per cent, each, for the day. Apollo Hospital Enterprises, Mahindra & Mahindra and Bharat Petroleum were other losers on the index.

Among the gainers, NTPC and JSW Steel surged 3 per cent, each, while ONGC gained 2 per cent for the day. Power Grid and Larsen & Toubro rose over a per cent, each, while Bajaj Auto and Cipla were also among other key gainers.

Investor sentiment took a downturn following the in-line monetary policy announcement by the RBI, as the market had higher expectations for a more optimistic revision in the inflation outlook, taking into account the recent easing of inflation data, said Vinod Nair, Head of Research at Geojit Financial Services.

"The RBI's decision to lower the inflation rate by only 10 bps suggests a cautious stance due to geopolitical uncertainties, potential impact of El Nino and increase in Minimum Support Price," he said.

A total of 3,6968 shares were traded on BSE on Thursday, of which 2,057 settled with cuts. 1,492 stocks ended the session higher while 119 shares remained unchanged. A total of 202 shares hit their upper circuit, whereas 100 shares tested the lower circuit levels for the day.

In the broader markets, Indian Energy Exchange dropped more than 8 per cent, followed by Suzlon Energy which declined 7 per cent on the back of profit booking. Jaiprakash Associates tumbled 6 per cent, while Valiant Organics and Hindware Home Innovations shed 5 per cent each for the day.

Among the Gainers, EKI Energy Services surged 19 per cent, while Tata Teleservices (Maharashtra) rose about 15 per cent. CarTrade Tech and Tribhovandas Bhimji Zaveri ended 11 per cent higher for the day. Eureka Forbes, Bannari Amman Spinning Mills and Sirca Paints were up 8-10 per cent each.

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