Domestic benchmarks closed on a negative note on Thursday, led by selling pressure in banking scrips, amid weak Asian equities. Reversing from 2 days of consecutive gains, Sensex ended 95 points lower to 38,990 and Nifty closed 7.55 points lower at 11,527.
Yesterday, Sensex ended 185 points higher at 39,086 and Nifty gained 64 points to 11,535.
Sectorally, gains in pharma, auto, media, FMCG, IT and media stocks were capped by losses in metals, realty, banking and financials. Britannia, NTPC, Hindalco, Bharti Airtel, IndusInd Bank, PowerGrid and ICICI Bank were among the top losers today. On the other hand, Wipro, UPL, Eicher Motors, Titan and Bharti Infratel were among the top gainers.
"Bank Nifty (down 1.44%) was the worst-performing index for the day on the basis of the Supreme Court observation on loan moratorium case. The Supreme Court said that banks should not take coercive action against borrowers. The next date of hearing on this case is scheduled on September 10," Keshav Lahoti, Associate Equity Analyst, Angel Broking.
"Today, also being Weekly F&O Expiry, contributed to increased volatility. Nifty is currently consolidating in the range of 11300-11600 with bias still remaining in favour of the bulls,"said Aamar Deo Singh, Head Advisory, Angel Broking.
Traders said market participants were also pessimistic on back of PMI data, that showed activity in India's services industry falling for a sixth straight month in August. Although the Nikkei/IHS Markit Services Purchasing Managers' Index increased to 41.8 in August from July's 34.2, it remained well below the 50-mark separating growth from contraction.
"The bias was upbeat in the beginning, following firm global cues but news of India's PMI data falling for the sixth month in a row in August dented sentiments in the middle and market remained range-bound thereafter," said Ajit Mishra, VP - Research, Religare Broking.
On the currency front, Indian rupee posted single-biggest session fall against the US dollar since May 4 and closed at 73.47 per dollar against the earlier closing of 73.03, amid weak momentum in the domestic equities and strong US dollar.
Domestic markets opened higher, tracking positive momentum from Asian markets that gained on better services sector activity in China. Although, the domestic equity market turned mixed and traded marginally lower by the afternoon session, amid weakness in Asian indices, as investors turned cautious amid rising US-China tensions and weak economic data.
Wall Street stocks closed higher on optimism over coronavirus relief package. European markets also traded higher ignoring not so good economic numbers from the Euro region.
Rising coronavirus cases also kept equities muted today. Worldwide, there were 261 lakh confirmed cases and 8.67 lakh deaths from COVID-19 outbreak. Meanwhile, India's death toll from COVID-19 infections rose to 67,486 and total coronavirus cases to 38.53 lakh as of Thursday.
On market's technical indicators, Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking said," Going ahead, 11550 followed by 11650 are the levels to watch out for in the upward direction for Nifty, whereas on the flip side, 11450-11400-11325 is the cluster of supports."
Ajit Mishra said,"The recent macroeconomic data suggests that economic revival would be gradual. Further, there are no positive domestic triggers to boost sentiments thus we suggest continuing with a cautious approach and keeping a close watch on the lingering broader tension between India and China for cues."
Manish Hathiramani, proprietary index trader and technical analyst at Deen Dayal Investments said,"Markets traded with lacklustre volumes with no definite direction. We continue being in a range between 11400-11600. If we need to see higher levels, we need to cross the resistance of 11600. That could take us to levels as high as 12000. A break of 11400 can take us to 11200-11250 levels."