What Happened With Market Today

Equity benchmarks declined the most in over six months, dragged by losses in banking, metals, and information technology stocks as a rating downgrade by Morgan Stanley and a central bank plan to drain liquidity soured sentiment in the world’s best-performing major market. Sensex plunged 1,159 points following an across-the-board selloff as monthly derivatives expired amid a weak trend in global markets.

Sensex fell 1,159 points or 1.90 percent to close at 59,985; while the broader NSE Nifty settled 354 points or 2 percent lower at 17,857. Top losers in the Nifty pack included ITC, ICICI Bank, Kotak Bank, Axis Bank, and Titan with their shares falling as much as 6 percent. While IndusInd Bank, L&T, Ultra Cemco, and Asian Paints were the major gainers rising up to 3 percent.

Sentiment has been dampening on account of weak global markets, lower than expected quarterly results and traders were booking profit on October series F&O expiry day. The RBI said late Wednesday that it will drain cash from the banking system for longer periods, spurring concern the move may temper gains in an equity market driven by record-low policy rates and a retail-investing boom. Morgan Stanley downgraded Indian stocks to equal weight from overweight. Commodity price declined sharply as the Aluminum price fell to a 2-month low and oil price declined 4% from the high. Both Asia and European markets declined as concerns that the prolonged pandemic and elevated inflation will hurt economic recoveries

On the NSE platform, all sub-indices finished in red with PSU Bank falling up to 5.22 percent. The NSE Realty index fell 3.77 percent, metal plunged 3.44 percent, and the NSE Bank index plunged 3.34 percent. Nifty, FMCG, Energy, mid-cap, small-cap, and Auto Index declined 1-2%. India Vix slipped 5% to close at 17.91.

Banking stocks witnessed profit booking PNB slip 11% to close at Rs41 after the company announced poor Q2 results. However, IndusInd Bank gained 3% to close at Rs1176 after the company reported strong results. ICICI Bank slipped shed 4% to close at Rs799. SBI, Axis Bank, HDFC Bank, Kotak Bank, and AU Bank declined 3-5%.

Metal stocks declined on account of declined base metal price on LME. Vedanta slipped 5% to close at Rs301. Nalco declined 3% to close at Rs99. Tata Steel, NMDC, JSW Steel, Hindalco, and Jindal Steel declined 2-4%.

Auto stocks like Tata Motor slipped 3% to close at Rs481. Bajaj Auto slipped 2% to close at Rs3701. However, TVS Motor climbed up 4% to close at Rs652 while Tata Motor managed to end positive territory. FMCG stocks like United Spirits gained 1% to close at Rs893 while touching an intraday high of Rs945. The company reported strong Q2 results. ITC slipped 6% to close at Rs225 as the company reported poor Q2 results. UBBL, GCPL, Colgate, and Tata Consumer slipped 1-3%.

Technical Outlook:

The nifty index opened negative and cascaded down to 17848 levels. The last hour of the session witnessed sustained selling pressure and the market was seen bleeding in red. Bears took full charge of the street and weakened all the sectors. It formed a big Bearish candle on a daily scale and closed with massive losses of more than 350 points. Now till it remains below 18000 zones, weakness could be seen towards 17777 and 17500 whereas resistance can be seen at 18050 and 18150 zones.

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