Profit booking drives Sensex lower, Nifty manages to hold 8500

Equity benchmarks wiped out all gains in last hour of trade with the Nifty falling below 8500 level intraday Monday after rallying 2.6 percent in the previous week. However, the market started off trade on a positive note following Reliance’s Q1 results and firm Asian peers. Oil, infra, telecom and select banking & financials dragged the market.The 30-share BSE Sensex fell 89.84 points to 27746.66 and the 50-share NSE Nifty declined 32.70 points to 8508.70.

Gaurang Shah of Geojit BNP Paribas says the market is expected to go in consolidation mode. Earnings calls and GST will decide the course of the market in the days to come, he feels.

ONGC was the major contributor to Sensex’s losses, down 5 percent after a media report indicated that the company along with Oil India (down 3 percent) faced additional royalty burden of more than USD 1 billion and the government has decided that companies would have to pay royalty to crude producing states at pre-discount rates.

Idea Cellular shares tanked 6.5 percent after the telecom operator slashed rates of 4G and 3G big internet packs by upto 67 percent. Bharti Airtel also has ripple effect, down 4 percent.

Hindustan Unilever was down 2 percent after disappointed analysts with revenue and volume growth in Q1. Profit increased 9.8 percent and revenue grew by 3.6 percent while volume growth stood at 4 percent against 6 percent in year-ago period and 4 percent in preceding quarter.

Reliance Industries fell 0.8 percent in late trade after rising 2.6 percent intraday due to better-than-expected bottomline and gross refining margin in June quarter.

ICICI Bank also saw profit booking, down 0.6 percent after rallying 1.5 percent intraday on filing of IPO papers of ICICI Prudential Life.

Infosys rebounded on short covering, up 0.88 percent after losing 8.8 percent in Friday’s session due to disappointing earnings in Q1.

HDFC, SBI, Adani Ports, Cipla, Tata Steel, BHEL and GAIL were down 1-2 percent.

The broader markets also closed lower with the BSE Midcap and Smallcap indices falling 0.6 percent and 0.5 percent, respectively due to weak market breadth. About 1635 shares declined against 1095 advancing shares on the Bombay Stock Exchange.

Asian markets mostly ended higher, shrugging off the failed military coup in Turkey. Hong Kong’s Hang Seng was up 0.66 percent while China’s Shanghai declined 0.3 percent. Japanese markets were shut for the Marine Day public holiday. European markets were mixed as investors digested a number of geopolitical events. France’s CAC was down 0.25 percent while Britain’s FTSE gained 0.3 percent.