MUMBAI: The Nifty extended its intraday losses and was near day’s low as traders booked profits in rate-sensitive’s such as banks and realty stock after the RBI hike repo rate by 25 basis points to 7.5 per cent from 7.25 per cent and reverse repo rate to 6.5 per cent from 6.25 per cent. According to analysts, the Nifty will continue to correct and take support near 5,850 levels. They do not rule out volatility ahead of September series expiry. Dollar inflows after the US Fed meet are likely to support the benchmarks in the near term. “The market seems to have ignored the fact that the US Fed has simply postponed the tapering. We would not be surprised to see tapering back on the agenda of the US Fed and the market in a few months’ time. This makes it imperative for India to (1) implement some reforms to strengthen the economy; fiscal reforms are critical and (2) build sufficient FX reserves for an eventual tapering. India needs to be vigilant against FII outflows and likely increase in gold imports/trade deficit over the next few months even as it gets FCNR-related inflows,” said Sanjeev Prasad of Kotak Securities.
At 10:30 a.m.; the 50-share index was at 5,913.75, down 98.35 points or 1.64 per cent. The index touched intraday high of 5,989.40 and a low of 5,912.20. The S&P BSE Sensex was at 19,947.94, down 315.77 points or 1.56 per cent. It touched a high of 20,138.76 and a low of 19,947.86 in trade today. The S&P BSE Midcap Index was down 0.75 per cent and the S&P BSE Small cap Index slipped 0.09 per cent. “Nifty has observed a sharp decline from its recent highs and has closed the rising window pattern which is a bearish signal. The index faces crucial hurdles at 5,900 levels on the upside, expect selling pressure to continue at higher levels. One should maintain a sell on rise approach and expect further declines to 5,750 & 5,700 levels,” said Nirmal Bang report.
“The Bank Nifty faces strong resistance around the 10,650 &10,700 levels on the upside where selling pressure is expected and one should maintain a sell on rise approach. There is an immediate support at 10,550 levels and on a decisive close below one can expect further weakness and declines to 10,250-10,150 levels,” the report added. Among the sectoral indices, the S&P BSE Bankex fell 3.91 per cent, the S&P BSE Realty Index was down 2.40 per cent, the S&P BSE Capital Goods Index was 1.81 per cent lower and the S&P BSE Oil & Gas slipped 1.50 per cent. The S&P BSE IT Index was up 0.59 per cent. HCL Tech (2.75 per cent), Ranbaxy (1.56 per cent), Infosys (1.24 per cent), Sesa Goa (1.10 per cent) and the market breadth was positive on the NSE with 453 gainers against 668 losers. Foreign institutional investors (FIIs) bought shares worth Rs 945.76 crore while domestic institutional investors were net sellers worth Rs 790.22 crore on Friday as per the provisional data from the National Stock Exchange.
Bureau Report
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