Equity benchmarks the Sensex and the Nifty settled in the red for the fifth consecutive session on February 23 amid mixed global cues.
The market is concerned about a more extended phase of monetary tightening and its impact on corporate earnings and economic growth.
According to a Reuters poll, global stock markets are expected to correct in the next three months as investors digest that interest rates are likely to stay higher for longer.
Sensex remained volatile throughout the session, reacting to mixed global cues and eventually ended 139 points, or 0.23 percent lower at 59,605.80 while the Nifty50 closed with a loss of 43 points, or 0.25 percent, at 17,511.25.
The BSE Midcap fell 0.40 percent while the Smallcap index ended with a slim gain of 0.06 percent.
As many as 268 stocks, including Adani Transmission, Adani Total Gas, Biocon, Godrej Properties, Laurus Labs, Macrotech Developers and Zee Entertainment Enterprises, hit their 52-week lows in intraday trade on BSE.
Crude oil prices saw a mild uptick as investors bet on a revival in demand in China. Brent Crude traded near the $81 per barrel mark. On the other hand, the rupeerose 11 paise to close at 82.74 per dollar even though the greenback strengthened on prospects of more rate hikes.
Top Nifty gainers: Shares of Hindalco, Coal India and Axis Bank ended as the top gainers in the Nifty index.
Top Nifty losers: Shares of Asian Paints, Larsen & Toubro and Titan ended as the top laggards in the Nifty pack.
Sectoral picture
Among the sectoral indices, Nifty Realty and Media indices fell almost 2 percent each. The Nifty Consumer Durables index fell about a percent.
On the other hand, the Nifty PSU Bank index rose about half a percent. Nifty Metal and FMCG indices rose 0.35 percent and 0.26 percent, respectively.
Experts' views on markets
"The equity market traded cautiously between gains and losses as the minutes of the central bank policy meeting revealed concerns over high inflation and its commitment to bring inflation under control. In response to the heightened fears of rate hikes, the US 10-year treasury yield continued to stay high, near 4 percent. Additionally, the dollar index rose as the greenback cheered over hawkish Fed comments and rising geopolitical tensions," said Vinod Nair, Head of Research at Geojit Financial Services.
Technical views on markets
Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas pointed out that on the daily charts, Nifty reached the daily lower Bollinger band and is also trading around a rising trendline support derived by joining the previous two swing lows which makes a case for a pullback over the next few trading sessions.
"The hourly momentum indicator has a positive crossover which is a buy signal. Thus, a bounce is likely, however, it is just a counter-trend rally and the bounce is likely to face resistance around 17,665 – 17,740 where resistance in the form of the key hourly moving averages is placed. Overall, the trend continues to be negative, and, on the downside, we expect the Nifty to target levels of 17,300 from a short-term perspective," said Gedia.
Rahul Ghose, Founder & CEO of Hedged, an algorithm-powered advisory platform, pointed out that the March Series of Nifty is seen having huge open interest (OI) concentration at the 17,500 PE (Put options) and the 17,000 PE strikes, indicating that traders are not expecting a very deep correction in the market.
He added that the in-the-money (ITM) 17,600 PE also saw shorting today, which eventually supported the Nifty index from falling further and outperforming the Bank Nifty for most of the day. The 17,500 strikes also saw short straddles being created for the next month, although the volume for this was not very high.
Ghose underscored that the March F&O series started on a neutral to bearish mode but the downtrend will only get confirmed once the 17,350 level is breached decisively.
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.
