Renewed inflationary pressures, led by a spike in prices of vegetables and cereals, have cast a spell on the equity markets in the past month. The BSE Sensex and Nifty50 have declined up to 2 per cent each during the period, clipping the 13 per cent rally from the March lows, shows data from ACE Equity. Investors typically consider shares of fast-moving consumer goods (FMCG) companies as defensive bets, putting their weight behind them in a falling market.
The record breaking spree was led by index heavyweights, financials and metal stocks.
Equity indices made an emphatic comeback on Friday after falling for seven straight sessions after the RBI hiked interest rates by 50 basis points on expected lines and projected inflation coming under control from January next year. A strong recovery in the rupee added to the momentum, traders said. Overcoming a wobbly start, the 30-share BSE Sensex soared 1,016.96 points or 1.80 per cent to settle at 57,426.92. During the day, it rallied 1,312.67 points or 2.32 per cent to 57,722.63.
Debt management is going to be a worry for the Vedanta group until FY25 at least. However, the restructuring of business divisions in Vedanta India could lead to an unlocking of values. The group structure is fairly complex. Anil Agarwal-led Vedanta Resources (VRL), which is London-listed, has a lot of debt on the balance sheet. It will have to repay $1 billion in secured bonds by January 2024 and at least another $300 million in calendar 2024.
The 30-share Sensex ended higher by 30 points.
In 10 sessions Sensex rose over 8%
Oil & gas, banking and pharma sector stocks stole the show
The NSE Nifty, comprising 50 shares, breached the 8,300-mark for the first time to hit a new lifetime high of 8,330.75.
The restraint on part of investors was chiefly because of RBI's minutes of its December policy meeting, which showed that some members were concerned about rising oil prices, its inflationary impact and possibility of fiscal slippage.
The 30-share Sensex ended 50 points lower at 28,112 and the 50-share Nifty declined 12 points to close at 8,531.
Of the 30-share Sensex pack, 15 today closed in the red
From the 30-Sensex pack, 26 stocks ended with gains led by Tata Steel and ICICI Bank
Market benchmarks gave up intra-day gains to close in the red for the sixth session on the trot on Friday, capping a bruising week which saw a massive dash for safety amid rate hikes by global central banks and fears of slowing growth.
After swinging nearly 330 points, BSE Sensex finished 172.69 points or 0.43 per cent higher at 40,412.57. Similarly, the 50-scrip NSE Nifty appreciated 53.35 points or 0.45 per cent to close at 11,910.15.
Auto stocks Hero MotoCorp and Mahindra & Mahindra gained 1-2 per cent on the back of strong sales in the month of September.
Oil and Natural Gas Corporation, Hindalco Industries, Tata Steel and Vedanta were down up to 70 per cent below their one-year highs.
Reliance Industries rose by 1.16 per cent while ITC and ICICI Bank zoomed up to 2 per cent, lifting the indices to all time high levels.
The markets may be entering a consolidation phase and are expected to trade sideways for now after a good run in the last few weeks, suggest analysts. In this backdrop, they suggest investors can book profits at the current levels and enter the market again on a decline from a medium-to-long term perspective. Thus far in fiscal 2023-24 (FY24), the S&P BSE Sensex has moved up around 5 per cent to nearly 62,000 levels.
Sensex,Nifty to remain under pressure through the week.
The rally in most of these stocks is partly attributed to impressive financial performance.
The broader NSE Nifty dipped below the 10,200-mark to hit a low of 10,180.25 before ending at 10,195.15, down by 165 points, or 1.59 per cent.
Reliance Industries and ONGC were down 4-6% each contributing the most to the Sensex losses
The sharp correction in the Indian markets from their peak levels has made valuations attractive, say analysts, who advise buying selectively, but only from a long-term perspective. Fifty-six of the Nifty 100 stocks, according to Mahesh Nandurkar, managing director at Jefferies, now trade below the 10-year historical averages, including stocks in financial, select auto, and pharma sectors. "Valuation (one-year forward consensus price-to-earnings, PE) has declined 25 per cent from October 2021 peak, almost matching the 33 per cent price-earnings contraction during the 2011 tightening cycle when repo rates went up by 375 basis points (bps) versus 250 bps this cycle.
The wider NSE Nifty touched a low of 10,652.40 before finishing at 10,671.40, showing a loss of 97.75 points, or 0.91 per cent.
The broader markets also ended lower in line with the benchmark indices
The 30-share bluechip index is rebalanced on a semi-annual basis with next rejig slated for June 18.
At the BSE, 1,552 stocks advanced, while 1,419 declined and 118 remained unchanged.
The 30-share Sensex ended 79 points lower at 26,909 and the 50-share Nifty closed 25 points lower at 8,102.
Investor wealth on Wednesday diminished by Rs 1.84 lakh crore amid massive sell-off in the equity market.
Five of the 12 BSE sectoral indices ended at 52-week highs; the oil and gas index zoomed by nearly 5%.
Financials declined amid profit taking while energy shares fell after the government hiked excise duty on transport fuels.
Reliance was the top gainer in the Sensex pack, surging over 3 per cent, followed by ICICI Bank, Bharti Airtel, Dr Reddy, Maruti and ITC.
The NSE Nifty after shuttling between 10,408.65 and 10,224 points, ended 58.30 points, or 0.57 per cent, lower at 10,245.25.
The 50-share Nifty scaled a high of 10,207.90 intra-day but succumbed to profit-booking to finish at 10,184.15, up 53.50 points
More than 10% (40 of 498 companies) have lost at least half their market value.
The sentiment got support from better-than-expected earning results by select companies and continuous buying by domestic financial institutions.
Pharma shares extended losses after the government's ban on combination drugs.
Markets ended higher, amid firm global cues, and are on track for third straight day of gains.
The broader Nifty finished at 10,421.40, up 194.55 points, or 1.90 per cent.
Caution prevailed across the bourses ahead of the Union Budget.
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