What happened with the market today

Equity benchmark Sensex plunged 525 points, led by losses in index majors HDFC twins, Tata Steel, and ICICI Bank amid a selloff in global markets. The 30-share BSE index ended 525 points or 1% percent lower at 58,490.93. Similarly, the broader Nifty tumbled 188 points or over 1 percent to 17,397. Tata steel was the biggest loser in the Nifty pack falling up to 10 percent. Future prices for steel-making raw materials dropped as China, the world’s top steelmaker, indicated it could expand strict air pollution controls to more cities. SBI, IndusInd Bank, Dr. Reddy’s, HDFC, and M&M were the other losers in the Nifty pack falling as much as 2-5% percent. Nifty Metal, PSU Bank, Realty, Pharma, Auto, and Bank index were major losers while FMCG Index gained. India Vix surged 15% to close to a 3-month high at 17.50.

Market taking a small pause, largely driven by nervousness in the global markets. Global markets declined 2-3% ahead of the upcoming US Fed meeting and the uncertainty building up in the Chinese real estate market due to stress on one of the major property players in the country. While the markets are keenly awaiting clarity on Fed’s taper plans in terms of timelines and quantum. Asian markets like the Hong Kong Index nosedive over 3% concern of China’s regulatory crackdown and signs of a slowdown in the global recovery. European markets slipped over 2% each as China’s real estate crackdown and worries ahead of this week’s Federal Reserve meeting fueled risk-off sentiment. The US Dow Future has also fallen over 1%.

Nifty Metal stocks witnessed the biggest losers today. The nifty Metal index slipped 7%. Nifty IT Index declined 1% while the Nifty FMCG Index advanced 1%. Nifty Auto, Pharma, Mid-cap, Small-cap, and Realty Index slipped nearly 2% each. Among the metal stocks, Tata Steel slipped 10% to close at Rs1253. Jindal Steel nosedived over 9% to close at Rs351. National Aluminium, JSW Steel, SAIL, Vedanta, and Vedanta declined 5-8%.

Among the banking stocks, SBI slipped 4% to close at Rs437. HDFC Bank, PNB, IndusInd Bank, Bandhan Bank, Axis Bank declined 1-4%. Auto stocks like Tata Motor declined 3% to close at Rs299. Bajaj Auto, Maruti, Hero Motocorp, and Eicher Motor slipped 1-3%. Pharma stocks like Aurobindo Pharma declined 5% to close at Rs712. Dr. Reddy shed 2% to close at Rs4775. Sun Pharma, Cipla, Biocon, and Cadila declined 2-4%. FMCG stocks Hindustan Unilever surged 3% to close at Rs2800 and ITC gained 1% to close at Rs233. Britannia, Marico, and Nestle gained 1% each.

Technical Outlook:

The Nifty index opened the gap down due to dampened global cues but managed to recover above 17600 in the initial hour. However, weakness swept across once again and it drifted toward immediate support of 17350 levels. It closed the day below 17400 with losses of around 190 points. It formed an Inverted Bearish Hammer kind of candle on a daily scale and negated its higher highs – higher lows of the last four sessions. Now till it holds below 17600 zones, a bounce could find selling pressure for the downside move towards 17350 and 17272 zones while on upside key hurdle exists at 17777 levels.

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