Sensex ends mildly lower, RIL offsets banks#39; losses; Nifty gains 18% in Samvat 2073
Equity benchmarks ended the last day of Samvat 2073 mildly lower on Wednesday, weighed down by banks after a sharp rise in Axis Bank’s bad loans were revealed the previous day. The losses, however, were offset by gains in index heavyweights Reliance Industries, HDFC Bank and ITC.
Overall, the market saw consolidation for a second consecutive session, after the sharp rally in the previous three straight days that lifted benchmarks to fresh record highs.
The 30-share BSE Sensex was down 24.81 points at 32584.35 while the 50-share NSE Nifty managed to hold 10,200 level ahead of the beginning of Samvat 2074, ending down 23.60 points at 10,210.90.
Experts expect Samvat 2074 to begin on a positive note but the consolidation is likely to rule for a few more sessions, especially ahead of expiry of October derivative contracts next week.
The Nifty rallied 18 percent in Samvat 2073 but there are some key risks which investors have to face in the near term, they said.
Sunil Singhania of Reliance Capital reiterated that India could be a USD 4-trillion economy in seven to eight years and the growth is expected to have its rub-off effect on equity markets, but in the near term, there are few risks which investors should not ignore. The risks include implementation of reforms, high valuations of smallcap companies and lower earnings growth.
“The rally that we have seen in 2017 is on the back of global liquidity and there’s another factor which investors should not forget — that is the rise is despite all the challenges this economy has faced,” he said in an interview with CNBC-TV18.
The market recorded healthy growth in Samvat 2073 as the Sensex surged more than 16.5 percent and the Nifty rallied over 18 percent while the Nifty Midcap gained 19 percent and BSE Smallcap was up 27 percent.
On Thursday, the market will open for one hour for Muhurat trade in the evening between 6:30 pm to 7:30 pm. On Friday, it will remain shut for the Diwali Balipratipada holiday.
The broader markets closed flat today due to balanced breadth. About 1,388 shares declined against 1,275 advancing shares on the BSE.
Banks suffered the most, especially after Axis Bank, the third largest private sector lender, posted a sharp rise in slippages. The stock itself lost 9.5 percent, followed by ICICI Bank, SBI and Yes Bank that lost 3-4 percent. Nifty Bank was down 332 points, but HDFC Bank (up 0.93 percent) and Kotak Mahindra Bank (up 1.6 percent) outperformed.
Reliance Industries was the biggest gainer among Nifty 50 stocks and ended at a record closing high of Rs 914.50, rising 4.6 percent on value buying.
Power Grid Corporation rallied 4.2 percent. The company emerged as successful bidder under tariff based competitive bidding to establish ‘Eastern Region Strengthening Scheme – XXI’ on build, own, operate and maintain basis.
Wipro gained 1.7 percent after second quarter earnings, though its third quarter dollar revenue guidance missed analysts’ expectations.
ITC, Indiabulls Housing, ONGC and NTPC gained 1-2.5 percent while Bharti Infratel, Cipla, HUL, Tech Mahindra, Sun Pharma, Bajaj Auto and Hero Motocorp were down 1-3.5 percent.
MAS Financial Services posted spectacular returns on the first day today, rising sharply by 42.65 percent to close at Rs 654.75.
In the broader space, JBF Industries rallied 19 percent on a media report suggested that the company is in discussions with potential buyers for stake sale.
Swan Energy rose 2.8 percent as subsidiary Swan LNG is developing an LNG port project in Gujarat at a cost of Rs 4,000 crore. Swan Energy holds a 63 percent stake in Swan LNG.
Peninsula Land gained 2 percent on receiving Rs 200 crore out of the total Rs 226 crore from Godrej for Pune Land.
