Sensex, Nifty snap 2-day winning run; M&M, Sun Pharma fall up to 3%; Apollo Micro jumps 20%

Domestic equity markets snapped the two-day winning streak to settle lower on Tuesday. Headline indices settled in red after a volatile trading session. Profit booking amid the mixed global cues weighed on the market sentiments and traders continued to remain cautious.

For the day, BSE Sensex declined 237.72 points, or 0.37 per cent, to end at 63,874.93. NSE's Nifty dropped 61.30 points, or 0.32 per cent to end the session at 19,079.60. However, broader markets outperformed headline peers as BSE midcap and smallcap indices settled in green. Fear gauge India VIX rose about 3 per cent to 11.83-levels.

Weak Asian market cues saw key benchmark indices languish in negative territory for a major part of the trading session amid selling in banking, auto and IT stocks. Even as India has somewhat managed to shrug off global challenges amid strong growth numbers, persistent FII selling has caused local markets to falter, said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

"We may see a mixed trend for markets in the near to medium term. On daily charts, the Nifty has formed a bearish candle indicating further weakness from the current levels. We are of the view that the market is likely to consolidate within the range of 18980 to 19220. However, below 18980, traders may prefer to exit out from long positions," he said.

On a sectoral front, the Nifty realty index gained more than a per cent, while the media and consumer durable indices added about a per cent each. Among the losers, the Nifty pharma, auto, healthcare and oil & gas indices were among the key laggards, falling up two-third per cent each.

In the Nifty50 pack, Sun Pharma dropped about 3 per cent, whereas Mahindra & Mahindra, Eicher Motors, LTIMindTree and ONGC dropped about 2 per cent each for the day. Among the gainers, SBI Life Insurance Company surged more than 3 per cent, while Titan Company and HDFC Life Insurance added over 2 per cent each.

"Modest cautiousness returned post yesterday’s bounce, ahead of the US Fed policy meeting, dragging Asian and Developed markets. The Fed is widely expected to keep rates unchanged, and the commentary on the future path will be the crucial factor to influence further direction, said Vinod Nair, Head of Research at Geojit Financial Services.

"Main indices witnessed marginal losses particularly led by IT stocks, while mid- & small-caps gained due to the recent moderation in valuations and buy-in dip strategy of domestic investors on the hope of pickup in demand in the upcoming festive season," he added.

A total of 3,760 shares were traded on BSE on Tuesday, of which 1,890 settled with gains. 1,749 stocks ended the session with cuts while 121 shares remained unchanged. During the day, 11 shares hit their upper circuit, whereas half a dozen shares tested the lower circuit levels for the day.

In the broader markets, Apollo Micro Systems hit an upper circuit of 20 per cent, while Sangam (India) surged more than 12 per cent. Repco Home Finance and Rajnish Wellness gained 11 per cent each. On the downside, PDS, Butterfly Gandhimathi, Ramco Systems and Rainbow Children's Medicare dropped 7 per cent each.

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