Sensex sheds over 300 pts, Nifty below 17,400; Paytm, Adani Ports climb up to 5%

Domestic equity markets kicked off the week on a muted note ahead of the key economic data later this week. India's GDP numbers and other global cues are likely to direct the markets this week. Stubbornly high inflation is weighing on the market sentiments.

At 9.25 am, the 30-share pack BSE Sensex was trading 324.42 points, or 0.55 per cent, lower at 59,139.51. NSE's Nifty50 was trading at 17,364.65, falling over 101 points, or 0.58 per cent. Broader markets posted steeper cuts as BSE midcap and smallcap indices dropped about a per cent each. Fear gauge India VIX spiked to 14.20-levels.

The formation of a lower high-low on the weekly chart signifies corrective bias. Going ahead, to pause the ongoing corrective phase, the index needs to decisively close above the previous session’s high. Failure to do so will lead to prolonged corrective bias amid global volatility towards immediate support placed around 17200 levels, said ICICIDirect.

"In the daily time frame, markets have approached the oversold zone after a six-day decline. Expect the index to find buying support around 17200 and pose a technical pullback from oversold readings towards 17800 in the coming week," it said.

All the sectors of the Nifty were trading in red on Monday. Media stocks were top laggards, followed by IT index, falling 2 per cent each. Auto and Metal indices shed over a per cent each. Pharma and banking stocks also weighed on the sentiments.

Among the Adani Group stocks, Adani Ports Ltd rose 2 per cent. On the contrary, Adani Enterprises ltd dropped about 3 per cent, whereas Adani Transmission ltd, Adani Green Energy ltd and Adani Total Gas ltd hit a lower circuit of 5 per cent each. Adani Power, Adani Wilmar and NDTV dropped 3 per cent each. Ambuja Cements Ltd and ACC Ltd were also trading in red.

With FII selling gathering pace the market has turned distinctly weak. The global market construct too is unfavourable. The rising US bond yields and firm dollar index are negative for EM equities. A data that is hugely significant from the Indian market perspective is the declining influence of Indian retail investors, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"In 2021 and 2022 sustained retail buying helped absorb FII selling and this kept the market resilient. Since the Indian economy continues to be strong, investors can use weakness in the market to accumulate high-quality stocks in banking, capital goods, IT, cement and across sectors," he said.

Bajaj Auto topped among the losers in the Nifty50 pack as the two-wheeler stocks plunged about 4 per cent over production cut buzz. Infosys, Bharti Airtel, Dr Reddy's Labs and UPL dropped 2 per cent each. Among the gainers, NTPC rose over a per cent, followed by ICICI Bank ltd, Nestle India ltd and State Bank of India ltd.

In the broader markets, Olectra Greentech extended its gains as the stock surged about 15 per cent after it announced its hydrogen bus in technical partnership with Reliance. One97 Communications rose about 5 per cent over the buzz that Bharti Airtel's Sunil Mittal is likely to buy a stake in the company.

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