Domestic equity benchmarks the Sensex and the Nifty ended lower after witnessing bouts of volatility on February 21 as investors awaited key data prints from some of the major economies in the world.
The eurozone, Britain, France and the United States are all set to publish flash February PMI data, with market players watching for signs of the toll tighter monetary policy has taken on activity, reported news agency Reuters.
Besides, the minutes of the Us Fed's last meeting are expected on February 22 which is also in investors' focus for hints on further monetary policy tightening.
Sensex opened 79 points higher at 60,770.43 and rose 285 points in intraday trade to 60,976.59. It, however, failed to hold gains and fell 108 points to hit the intraday low of 60,583.72.
The index finally closed 19 points, or 0.03 percent, lower at 60,672.72. Nifty50 closed at 17,826.70, down 18 points, or 0.10 percent.
Mid and smallcaps underperformed the largecaps; the BSE Midcap index fell 0.21 percent while the Smallcap index suffer a loss of 0.31 percent.
The volatility index India VIX jumped 4.67 percent to the level of 14.
Almost 180 stocks, including Adani Green Energy, Adani Transmission, Bata India, Biocon and Ipca Laboratories, hit their fresh 52-week lows in intraday trade on BSE.
Meanwhile, crude oil prices declined on profit booking as investors remained concerned over the demand scenario for the commodity in light of the global economic slowdown.
However, the rupee slipped 6 paise to end at 82.80 per dollar as the greenback hovered around its six-week high level.
Top Nifty gainers: Shares of NTPC, Britannia Industries and Tata Steel ended as the top gainers in the Nifty index.
Top Nifty laggards: Shares of Adani Enterprises, Apollo Hospitals Enterprise and Coal India ended as the top laggards in the Nifty pack.
Among the sectoral indices, Nifty FMCG (up 0.11 percent), Financial Services (up 0.05 percent) and Consumer Durables (up 0.04 percent) ended with nominal gains.
Among the losers, Nifty PSU Bank fell 1.79 percent. Nifty Realty, IT and Media fell up to a percent.
Experts' views on markets
Vinod Nair, Head of Research at Geojit Financial Services pointed out that amid inflationary concerns, the market is keenly eyeing the US fed meeting minutes, scheduled to be released tomorrow, for hints on further monetary policy tightening.
Risk appetite was further hammered by FIIs turning net sellers and fear of El Niño, said Nair.
Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities highlighted the markets were extremely rangebound with a negative bias as the shutdown of the US markets on Monday prompted investors to take a cautious stance.
"The markets have been more or less sluggish to negative over the past few sessions due to factors like rising interest rates, higher inflation, lingering geopolitical tensions, and slowing growth," said Chouhan.
Technical views on markets
Rupak De, Senior Technical Analyst at LKP Securities pointed out that the Nifty ended flat following a volatile trading session but the bias remained negative as it falls back into the descending channel on the daily chart.
Besides, the momentum oscillator RSI has entered a bearish crossover.
De said immediate support is visible at 17,750, below which the selling pressure may increase.
Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas observed that the key hourly moving averages placed in the 17,920 – 17,950 zone acted as a stiff resistance and the morning bounce fizzled out after reaching this resistance zone.
"On the hourly momentum indicator, we can observe a positive divergence developing which is a sign that the selling pressure is weakening. Thus, the price and the momentum indicators are providing divergent signals and in such a scenario a consolidation is highly likely," said Gedia.
"The range of consolidation is likely to be 18,150 – 17,650. In terms of levels, 17,920 – 17,950 shall act as immediate hurdle one while on the downside the 17,650 – 17,600 which coincides with the 61.82 percent Fibonacci retracement level shall act as crucial support to watch out for from a short-term perspective," Gedia said.
As per Chouhan, as long as the Nifty is trading below 17,900, the weak sentiment is likely to continue and below the same, it could slip to 17,750-17,700. On the flip side, a quick pullback is possible if the market trades above 17,900 and on further appreciation, it could move up to 17,950-18,000.
Key market data
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of MintGenie.