Muhurat Trading: Global cues drag Sensex 194 pts, Nifty Bank slips 304 pts on Day 1 of Samvat 2074

The market started off Samvat 2074 on a negative note Thursday, with the Sensex falling 265 points intraday on selling pressure in banks. Weak global cues also dented sentiment.

The 50-share NSE Nifty breached 10,200 level, declining 64.40 points to close at 10,146.50. The index was down 105 points from its record high of 10,251.85 hit on October 17.

The 30-share BSE Sensex fell 194.39 points at 32,389.96, dragged by 25 stocks.

The profit booking was warranted after recent rally in the market, experts said. According to them, the market is expected to consolidate in the coming week as October derivative contracts will expire on Thursday.

September quarter earnings will also be closely watched from hereon, especially banks after sharp rise in Axis Bank’s slippages, said experts who remain bullish on the market with long term perspective.

“I think in the next couple of quarters if the earnings don’t improve, markets will be in a spot of trouble,” said Ramesh Damani, Member BSE in an exclusive interview with CNBC-TV18.

Valuations are excessive compared to their earnings, he feels.

“I see near-term pain if Nifty Bank underperforms which could lead to some consolidation in the market. The crucial support for the index stands at 9,700 and a breach of which could take Nifty towards 9,200 levels,” said Atul Suri, Chief Investment Officer at Marathon Trends PMS.

Suri, however, is very bullish on markets for the next 3-4 years.

The market will remain shut on Friday for Diwali Balipratipada.

In Samvat 2073, the Nifty 50 shot up 18.2 percent and the Sensex rose 16.62 percent while Nifty Midcap gained 19 percent. Nifty Bank surged 24.3 percent. Energy, Metal and Realty indices were biggest gainers, rising between 37-44 percent.

All sectoral indices closed in red today. Nifty Bank hit badly, falling 304 points or 1.25 percent while Auto, FMCG, IT, Metal and Pharma indices were down 0.2-0.9 percent.

Axis Bank extended losses, declining 0.9 percent on top of 9.5 percent fall in previous session after disappointing Q2 earnings.

Its rivals HDFC Bank, ICICI Bank, Yes Bank, Kotak Mahindra Bank and IndusInd Bank were down 1-2 percent after the RBI’s latest minutes indicated that there could be no rate cut in December policy meeting.

Reliance Industries share price hit a record high of Rs 921.90 in opening trade today but failed to sustain those gains for long. The stock ended down half a percent on profit booking.

Bharti Airtel was biggest gainer among Nifty 50 stocks, rising 2.55 percent. The stock in October month, so far, gained 21 percent, especially after its deal with Tata Teleservices.

Tata Teleservices was locked at 5 percent upper circuit again. Its board of directors has approved fund raising up to Rs 20,000 crore.

Among others, Tata Motors, Bajaj Finance, Vedanta, Adani Ports, ONGC and BPCL fell over a percent whereas Infosys, M&M, Indiabulls Housing and Lupin ended marginally higher.

The broader markets ended mixed as the BSE Midcap index was down 0.25 percent while Smallcap gained 0.11 percent. About 1,490 shares advanced against 982 declining shares on the BSE.

Global markets were under pressure today. US equities – Dow Jones, Nasdaq and S&P 500 – fell 0.2-0.6 percent at the time of writing this article. European markets closed lower while Asia ended mixed, with Hong Kong’s Hang Seng falling nearly 2 percent.
Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.