Domestic equity benchmarks the Sensex and the Nifty closed in the negative territory for the second consecutive session on February 7, tracking weak global cues as investors avoided riskier equities awaiting Fed Chair Jerome Powell's speech later today to get a cue on the rate hike trajectory.
The surprisingly strong US jobs report fanned concerns that the Fed will keep hiking rates for a longer period and the rates will touch a level higher than expected before.
Back home, the three-day Monetary Policy Committee (MPC) meeting is underway. The Reserve Bank of India (RBI) is expected to announce a 25 bps hike in policy rates on February 8.
The Sensex opened almost flat at 60,511.32 against the previous close of 60,506.90 but fell 443 points in intraday trade to 60,063.49. The index finally closed 221 points, or 0.37 percent, lower at 60,286.04. The Nifty50 closed the day at 17,721.50, down 43 points, or 0.24 percent.
The BSE Midcap index ended almost flat while the Smallcap index lost 0.16 percent.
As many as 166 stocks, including Adani Transmission, Divi's Labs, Sanofi India and Thyrocare Technologies, hit their 52-week lows in intraday trade on BSE.
Crude oil prices rose for the second consecutive session, underpinned by recovering demand in China. Concerns over supply shortages after an earthquake in Turkey also supported oil prices. Benchmark Brent Crude traded above the $82 a barrel mark.
The rupee rose 3 paise to close at 82.70 per dollar.
Top Nifty gainers: Shares of Adani Enterprises (up 15.28 percent), Dr Reddy's Labs (up 1.94 percent) and Adani Ports (up 1.93 percent) ended as the top gainers in the Nifty index.
Top Nifty losers: Tata Steel (down 5.32 percent), Hindalco (down 4.02 percent) and ITC (down 2.61 percent) ended as the top loser stocks in the Nifty index.
Sectoral picture
Barring Nifty Realty (up 0.88 percent), Nifty Bank (up 0.28 percent), Nifty Private Bank (up 0.19 percent) and Nifty Financial Services (up 0.13 percent), all sectoral indices ended in the red.
Nifty FMCG and Auto indices ended lower by a percent each while Nifty Consumer Durables and Media slipped by half a percent each.
Experts' views on markets
Vinod Nair, Head of Research at Geojit Financial Services said sentiments in the domestic market were hammered by bears that dominated the US market post the release of strong jobs data.
"Global markets are currently driven by central bank policies and the surge in bond yields in expectation of more rate actions. A recovery was seen in the second half of the day as US futures inched higher as investors await Powell’s speech," said Nair.
Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities said markets witnessed caution with a negative bias through the trading session, as investors booked profit ahead of the RBI's credit policy meeting.
"It has been more or less a rangebound market in the last few sessions as investors don't want to risk by taking long exposure to equities given the current uncertainty in global markets. Also, the persisting interest rate hikes in key economies have been a concern amid fears of an economic slowdown," said Chouhan.
Technical view on markets
Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan by BNP Paribas pointed out that the Nifty witnessed oscillations near the key hourly moving averages and ultimately closed in the red. The hourly Bollinger Bands are contracting, which is in line with the ongoing consolidation.
"Structurally, the consolidation can continue in the tight range of 17,650-17,800 before the index extends towards 18,000 on the upside. The hourly chart also shows that the Nifty is trading just below a falling trendline and once the index crosses the level of 17,800 on the higher side, it will be considered as a trendline breakout," said the analyst.
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.
