scorecardresearchMarket Wrap: Sensex, Nifty now up to 18% off their record highs; investors

Market Wrap: Sensex, Nifty now up to 18% off their record highs; investors lose 15 lakh crore in a week

Updated: 17 Jun 2022, 04:41 PM IST
TL;DR.

The Sensex closed 135 points, or 0.26 percent, lower at 51,360.42 while the Nifty ended the day 67 points, or 0.44 percent, lower at 15,293.50. BSE Midcap and Smallcap indices closed with losses of 0.68 percent and 0.88 percent respectively.

Now, Sensex is 17 percent below its all-time high of 62245.43 that it hit on October 19, 2021. Nifty is 18 percent down from its all-time high of 18,604.45. BSE Midcap and Smallcap indices are down 22 percent and 23 percent, respectively, from their all-time highs. Photo: PIxabay

Now, Sensex is 17 percent below its all-time high of 62245.43 that it hit on October 19, 2021. Nifty is 18 percent down from its all-time high of 18,604.45. BSE Midcap and Smallcap indices are down 22 percent and 23 percent, respectively, from their all-time highs. Photo: PIxabay

Domestic equity benchmarks the Sensex and the Nifty ended in the red after hitting their fresh 52-week lows on June 17 as concerns over aggressive rate hikes and their impact on the global growth continued weighing on sentiment.

With June 17 close, the benchmarks extended their losing streak into the sixth consecutive session.

Sensex hit its fresh 52-week low of 50,921.22 while the Nifty plumbed its 52-week low of 15,183.40 in intraday trade. BSE Midcap and Smallcap indices also hit their 52-week lows of 21,104.35 and 23,887.9 respectively.

Eventually, the Sensex closed 135 points, or 0.26 percent, lower at 51,360.42 while the Nifty ended the day 67 points, or 0.44 percent, lower at 15,293.50. BSE Midcap and Smallcap indices closed with losses of 0.68 percent and 0.88 percent respectively.

"Rising inflation and policy tightening by global central banks are forcing the market to discount the possibilities of recession. With central banks’ policy tone pointing towards continued rate hikes of higher magnitude, we can expect FIIs to maintain their selling spree. The domestic market will continue to trade with high volatility in the near term, however, the ongoing corrections are opportunities in disguise on medium to long-term investments," said Vinod Nair, Head of Research at Geojit Financial Services.

In the Sensex index, only 9 stocks ended in the green while the rest 21 fell. Shares of Bajaj Finance (up 2.63 percent), Bajaj Finserv (up 2.47 percent) and ICICI Bank (up 1.43 percent) ended as the top gainers while those of Titan (down 6.06 percent), Wipro (down 4.07 percent) and Dr Reddy's Labs (down 3.35 percent) ended as the top laggards.

Barring BSE Bankex (up 0.42 percent), Finance (up 0.24 percent), Metal (up 0.20 percent) and Realty (up 0.03 percent), all sectoral indices ended in the red, with Oil & Gas falling 3.07 percent and Consumer Durables ending 2.68 percent lower.

Nearly 450 stocks, including Asian Paints, Axis Bank, Bajaj Finance, HCL Tech, HDFC, HDFC Bank, IndusInd Bank, Infosys, Tata Steel, TCS, Tech Mahindra, UltraTech Cement and Wipro, hit their fresh 52-week lows in intraday tarde.

Now, Sensex is 17 percent below its all-time high of 62245.43 that it hit on October 19, 2021. Nifty is 18 percent down from its all-time high of 18,604.45. BSE Midcap and Smallcap indices are down 22 percent and 23 percent, respectively, from their all-time highs.

For the week, Sensex (down 5 percent), Nifty (down 6 percent), BSE Midcap (down 5 percent) and BSE Smallcap (down 7 percent) lost significantly.

The overall market capitalisation of BSE-listed firms dropped to 236.8 lakh crore from 251.8 lakh crore on June 10, making investors poorer by 15 lakh crore in a week.

Ajit Mishra, VP - Research, Religare Broking highlighted that the market is largely taking cues from the global markets due to the absence of any major domestic event. Going ahead, the US Fed chairman's speech and China's interest rate decision would be important triggers for the markets. On the domestic front, the Covid trend and the progress of the monsoon will also be in focus said Mishra, reiterating his negative view on markets and suggesting continuing with the “sell on rise” approach.

Technicals

Nifty formed an indecisive Doji candlestick on the daily chart after the recent down-move on June 17, suggesting the possibility of an upward reversal. Deepak Jasani, Head of Retail Research, HDFC Securities pointed out that Nifty formed a Doji candle after a 5.6 percent fall over the week, the highest since May 2020. The low of June 17 (15,183) will hence be crucial while on rises, 15,335 and 15,659 can act as resistance.

Mazhar Mohammad, Founder & Chief Market Strategist, Chartviewindia.in observed Nifty formed a 'bearish belt hold' kind of formation on the weekly charts, with a bearish gap and it seems to have marginally breached possibly three-month-old channel support.

He said unless the Nifty recovers and sustains above 15,360, the trajectory of this market shall remain sideways with a negative bias.

"In case the index slips below 15,183 in the next session then the weakness may extend to 14,900. However, as the Nifty has fallen around 1500 points in the last 10 days, from the highs of 16,793, most momentum oscillators have not only reached oversold levels but some are displaying positive divergence on the lower time frame charts also. Hence, the next session can belong to bulls but short-term traders are advised to wait for more stability before initiating a trade," said Mohammad.

Disclaimer: The views and recommendations made above are those of individual analysts not of MintGenie.

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First Published: 17 Jun 2022, 04:41 PM IST