Domestic market benchmarks the Sensex and the Nifty ended in the negative territory on the last day of August on Thursday, tracking weak global cues, while investors awaited India’s Q1 GDP prints which are expected later today.
The domestic market witnessed heightened volatility today, which was the last day of the August futures and options (F&O) series, in light of weak global cues. As Reuters reported, “World shares limped towards their worst month since February, with sentiment hurt by still-gloomy China factory readings on Thursday, as traders awaited European and US data that could add to bets that interest rates have peaked.”
Volatility index India VIX rose over 2 per cent to 12.06 today.
Concerns over the global economic slowdown continue weighing on sentiment even as the Indian economy is expected to remain on the path of solid growth.
India’s GDP likely moved up to 7.7 per cent in the April-June quarter of the current fiscal (2023-2024), recording the fastest annual pace in a year, supported by healthy government capital expenditure, improved investment activity and the low base of the same quarter last year.
However, some economists and rating agencies expect India’s Q1 GDP prints to beat the 8 per cent forecast of the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC).
Read more: India Q1 GDP data today: This is how other major economies fared in June quarter
Stock market today
Sensex opened with a gain of 91 points at 65,178.33 against the previous close of 65,087.25 and rose about 190 points to hit the intraday high level of 65,277.04. The index, however, failed to hold gains and fell for about 364 points to hit the intraday low of 64,723.63. The Nifty50 hit its intraday high and low of 19,388.20 and 19,223.65 respectively.
The Sensex ended with a loss of 256 points, or 0.39 per cent, at 64,831.41 while the Nifty ended the day at 19,253.80, down 94 points, or 0.48 per cent.
Shares of HDFC Bank, Reliance Industries and TCS ended as the top drags on the Sensex index.
Mid and smallcaps, on the other hand, continued their outperformance. The BSE Midcap index closed 0.02 per cent lower at 31,200.60 after hitting its fresh record high of 31,352.15 during the session. The Smallcap index ended with a gain of 0.79 per cent at 37,143.67 after hitting its record high of 37,197.2 during the session.
The overall market capitalisation of the firms listed on the BSE dropped to nearly ₹309.6 lakh crore from ₹310.3 lakh crore in the previous session, making investors poorer by about ₹0.7 lakh crore in a single session.
In August, Sensex and Nifty retreated by 2.5 per cent while the BSE Midcap index climbed 2.6 per cent and the BSE Smallcap index rose 6.12 per cent.
Top Nifty gainers and losers today
As many as 35 stocks ended in the red in the Nifty index while 16 ended with gains.
Shares of Jio Financial Services (up 3.78 per cent), Maruti Suzuki (up 2.08 per cent) and HDFC Life Insurance Company (up 1.41 per cent) ended at the top of the index.
On the flip side, shares of Adani Enterprises (down 3.51 per cent), BPCL (down 3.31 per cent) and Adani Ports (down 3.18 per cent) ended as the top losers in the index.
Sectoral indices today
Barring Nifty Consumer Durables (up 0.83 per cent), Realty (up 0.65 per cent) and IT (up 0.20 per cent), all sectoral indices ended with losses today, with Nifty PSU Bank (down 1.33 per cent) and Oil & Gas (down 1.04 per cent), falling over a per cent each.
Nifty Bank index closed 0.55 per cent lower at 43,989.15. The index extended the losses into the second consecutive session. For August, the index declined 3.64 per cent.
Experts’ views on markets
“Markets crumbled sharply on the monthly expiry day as investors trimmed their exposure amid concerns over global economic uncertainty and weak Asian cues. Persisting foreign fund outflows coupled with further rate hike concerns and trouble in China’s growth activity have dampened investors’ sentiment,” said Shrikant Chouhan, Head of Research (Retail), Kotak Securities Ltd.
“A slew of weak economic indicators from the US, including a softened GDP figure, have heightened the likelihood of a pause in the Fed’s rate tightening, resulting in a downward trajectory of bond yields. However, this development had a limited impact on domestic sentiment on the day of expiry, with the market experiencing declines ahead of the release of India’s GDP data, scheduled for today,” said Vinod Nair, Head of Research at Geojit Financial Services.
“Global markets joined the trend as Eurozone inflation persisted at 5.3 per cent as per preliminary estimates, surpassing the market’s anticipation of 5.1 per cent along with negative cues from Asian economies,” Nair said.
Technical views on Nifty
Chouhan pointed out that the Nifty, on intraday charts, has been facing selling pressure at higher levels and on daily charts, it formed a bearish candle, which is largely negative.
“For traders, 19,220 would act as a sacrosanct support zone, and if the index trades above the same, it will bounce back till 19,320-19,380. On the flip side, below 19,220, the selling pressure is likely to accelerate and could slip to 19,150-19,125,” said Chouhan.
Rahul Ghose, Founder & CEO of Hedged, an algorithm-powered advisory platform observed that the Nifty today added massive shorts going into the September series at the 19,400 and the 19,500CE. But all is not lost even though today’s price movement suggests a significant breakdown.
“The 19,000 puts of the September end expiry also added significant writing hinting towards consolidation around the 19,000 level. Traders who are already short should book their positions between the 19,000 and 19,100 level and wait for two bearish candle closings below 19,000 to reinitiate shorts. Although Bank Nifty saw a breakdown as well, the put OI writing is showing signs of consolidation more than a sharp down move,” said Ghose.
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