After opening at record highs, benchmark indices turned volatile and closed lower on Wednesday, tracking cues from mixed global equities. Reversing ten straight sessions of gains, Sensex fell 263 points to 48,174 and Nifty closed 53 points lower at 14,146.
Earlier, Sensex opened 190 points higher at 48,592 and Nifty gained 41 points to 14,240. In early trade, Sensex hit a lifetime high of 48,616 and Nifty rose to a new high of 14,244. In the previous session, Sensex ended 260 points higher at 48,437 and Nifty gained by 66 points to 14,199.
Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments said,"14250 worked as a stiff resistance and we did see a sharp fall in the market. Although we did rebound from the lows, I would advise caution as sharp movements cannot be ruled out. Hence, strict stops should be maintained and traders should initiate long positions only on dips or corrections."
Vinod Nair, Head of Research at Geojit Financial Services said, "Market is experiencing volatility due to weak Asian markets and profit booking owing to rich valuation. Banking stocks are supportive, led by good loan growth data for Q3FY21, announced by key private banks. In the near-term, trend of the broad market will depend a lot on FII inflows while stock specific actions will be based on Q3 result, which is about to pick up."
On the currency front, Indian rupee rose 6 paise to close at 73.11, supported by sustained foreign fund inflows and weaker American currency.
Sectorally, gains in metal, media and banking indices were capped by losses in FMCG, pharma, IT and auto sectors.
Maruti, TCS, Asian paints, ITC, Reliance Industries, HUL, HCL Tech, UltraTech Cement and Bajaj Finance were among the top losers today. On the other hand, ONGC, Titan, SBI, ICICI Bank and Bharti Airtel were among the gainers.
Overseas, Asian stocks were trading mixed, taking cues from overnight trading in Wall Street. US stock closed higher on Tuesday in choppy trading, as investors anxiously awaited the outcome of the Senate runoff elections in the battleground state of Georgia, which will determine the balance of power in Washington.
Further weak economic data out of China and US also kept sentiments weak. Where a private survey showed services sector activity in China expanding at a slower pace in December, the US manufacturing index rose to 60.7 in December - its highest level since August 2018 - from 57.5 in November.
Investors also turned cautious amid surging virus cases and after Trump administration further sanctioned Chinese companies, fuelling unease over tensions between the two biggest economies. In an escalation of a trade war, President Donald Trump signed an executive order banning transactions with eight Chinese apps including Alipay and WeChat Pay.