scorecardresearchMarket Wrap: Sensex, Nifty end lower on profit booking

Market Wrap: Sensex, Nifty end lower on profit booking

Updated: 16 Jan 2023, 04:31 PM IST
TL;DR.
Sensex closed 168 points, or 0.28 percent, lower at 60,092.97 and Nifty ended 62 points, or 0.34 percent, down at 17,894.85.
Sensex ended in the red on January 16.

Sensex ended in the red on January 16.

Indian shares ended lower on January 16 as the risk appetite of investors remained low on softer quarterly earnings even though global cues were mostly positive.

Profit booking was seen in most sectors, however, PSU bank and IT stocks witnessed buying.

Global markets were mostly positive due to optimism over China's reopening and corporate earnings.

"Shares firmed on Monday as optimism over corporate earnings and China's reopening offset concerns the Bank of Japan (BOJ) might temper its super-sized stimulus policy at a pivotal meeting this week, while a holiday in U.S. markets made for thin trading," reported Reuters.

Sensex closed 168 points, or 0.28 percent, lower at 60,092.97 and Nifty ended 62 points, or 0.34 percent, down at 17,894.85.

Mid and smallcaps also declined. The BSE Midcap index fell 0.34 percent while the Smallcap index slipped 0.10 percent.

Crude oil prices slipped as concerns over the rising numbers of Covid-19 cases in China weighed on sentiment. Brent Crude traded near the $85 per barrel mark. The rupee fell 28 paise to close at 81.61 per barrel.

Top Sensex gainers: IT stocks led the pack of Sensex gainers. Shares of Tech Mahindra, HCL Tech, Infosys, Wipro and TCS ended as the top gainers in the Sensex index.

Top Sensex losers: Shares of Axis Bank, NTPC, HDFC, HDFC Bank and Mahindra and Mahindra ended as the top losers in the Sensex kitty of stocks.

Sectoral picture

Barring Nifty PSU Bank (up 1.57 percent), Nifty IT (up 1.14 percent) and Nifty FMCG (up 0.12 percent) indices, all sectoral indices ended in the red.

Nifty Media and Metal indices fell over a percent each while NIfty Bank, Nifty Financial Services, Auto, Private Bank and Consumer Durables fell about half a percent each.

Experts' views on markets

Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities pointed out that the sluggish mood continued as markets moved in a narrow range with a negative bias.

"Investors are taking a cautious stance as the global macroeconomic scenario remains bleak while FIIs continued to be sellers in domestic equities in the current month, thus dampening the market sentiment," said Chouhan.

"In the event of subdued Q3 results, soft budget expectations and cliffing of global rates, the market is contemplating high volatility as these scenarios envelop the future trend," said Vinod Nair, Head of Research at Geojit Financial Services.

Technical views by experts

Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas observed that the Nifty has been witnessing short-term consolidation for the last few weeks. In terms of price patterns, it has formed a triangle on the daily chart.

Towards the end of the last week, the Nifty had formed a base near the lower end of the pattern. Consequently, the index took a leap on the upside and saw a gap-up opening on January 16. However, the index stumbled near the upper end of the pattern and stayed back in the pattern.

"Till the time the index trades above 17,800 on a closing basis, the pattern is eventually expected to break out on the upside. The Nifty will be set for a larger bounce, once it crosses the near-term barrier of 18,050," said the analyst.

Chouhan pointed out that technically, the market is consolidating within the range of 17,850 to 18,050 range. On daily charts, the Nifty has formed a bearish candle near the 100-day SMA (simple moving average) which is broadly negative.

"We are of the view that 17,800 would act as a sacrosanct support zone for the traders, and a fresh round of selling is possible only after the dismissal of 17,800. Below the same, the index could slip to 17,700-17,650. On the flip side, 18,000 would be the trend reversal level for the bulls and above the same, the index could move up till 18,100-18,135," said the analyst.

Key market data

Article
Active stocks
Article
Volume shockers

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of MintGenie.

Article
How to make long-term investment more rewarding
First Published: 16 Jan 2023, 03:32 PM IST