Increases market deficit; Sensex down 2,792 points in five days, Nifty down 782 points

On Wednesday, the Sensex closed at 57,555.90, down 344.29 points or 0.59%. The Nifty 50 closed at 16,972.15, down 71.15 points or 0.42%.

Among large-cap stocks on the Sensex, Bharti Airtel was the top loser, falling over 2% followed by IndusInd Bank, Reliance Industries, Hindustan Unilever, HDFC Bank and SBI falling between 1.5% and 1.9%.

In the list of top gainers, Asian Paints led the way with a rise of over 3%, followed by Tata Steel and Titan, two stocks of the Tata group, up 2.1% and 1.8%. L&T, Power Grid and Kotak Bank were also up 1-1.5% each.

In the broader market, smallcap indices outperformed but broad-based selling pressure capped the gains.

Talking about the sectoral index, the trend of sluggishness remains in the banking stocks. BSE Bankex fell around 383 points, while Bank Nifty dropped around 360 points.

On the other hand, capital goods, consumer durables and metal stocks were among the star performers with the indices on the BSE accounting for around one per cent each.

Vinod Nair, Head of Research, Geojit Financial Services, said, “In-line data showing fall in US inflation provided a gap-up opening in the context of a global relief rally, fueling confidence that the Fed will not opt ​​for a tighter rate cut.” Hike after banking sector turmoil. Broader rate hike expectation has come down to 25 bps from 50 bps and there are possibilities that Fed may even consider not to hike at March policy meeting. Domestic gains were short-lived , as European markets declined. Fears that the ECB will hike interest rates by at least 25 bps at its meeting on Thursday are a concern for the higher interest rate stock market.”

European shares pared the previous session’s gains and were back in the red zone on Wednesday as investors turned cautious on banking sector concerns. In addition to the saga of the collapse of the Silicon Valley bank, Credit Suisse shares are plunging after its top shareholder refused fresh bailout. Main indexes in Paris and Milan declined by more than 3%, while Frankfurt and London lost at least 2.5%. While the share price of Credit Suisse fell by 24% and that of Societe Generale by almost 10%.

At the interbank foreign exchange market, the rupee on Wednesday gave up early gains to close at 82.5950 against the US dollar. The local unit failed to hold on to its gains in early trade as foreign banks and public sector banks tapped the dollar, boosting demand for the greenback. The rupee had closed at 82.49 on the previous day.

Going forward, Rohan Shah, Principal Technical Analyst, Stoxbox said, “Nifty closed below 200 DMA for the fourth consecutive day. Intraday traders can look for long opportunities only above the resistance level of 17,250 if it holds for 15 minutes.” Traders can look for fresh shorts only if Nifty breaks 16,900 level and stays below for 15 minutes to ensure short.”

While Rupak Dey, Senior Technical Analyst, LKP Securities said, “Market bears maintained control as Nifty declined for the fifth consecutive day. At the lower end, the index moved closer to the lower band of the descending channel.” Going forward, 16950 will act as an important support for the index on a closing basis. Only a close below 16950 can trigger further correction. Resistance on the higher end is visible at 17150-17200.”

Regarding Bank Nifty, Rupak Dey, Senior Technical Analyst, LKP Securities said, “The index is continuing to trade below important short-term moving averages on the daily chart. The momentum indicator is in a bearish crossover. A fall below 39000 could trigger a downside move.” Further correction towards 38800/38500. Resistance at higher end is visible at 39500.”

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