Market Wrap: D-Street ends flat as banks offset global optimism; Sensex sheds 53 points, Nifty holds 25,100

Economic Times

2 days ago

The benchmark BSE Sensex closed marginally lower on Tuesday, while the broader NSE Nifty 50 ended unchanged, as profit booking in financial stocks outweighed optimism stemming from U.S.-China trade talks and policy support from the Reserve Bank of India.
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The benchmark BSE Sensex closed marginally lower on Tuesday, while the broader NSE Nifty 50 ended unchanged, as profit booking in financial stocks outweighed optimism stemming from U.S.-China trade talks and policy support from the Reserve Bank of India.The BSE Sensex fell 53.49 points, or 0.06%, to settle at 82,391.72, while the NSE Nifty eked out a modest gain of 1.05 points to close at 25,104.25.Indian benchmarks Sensex and Nifty opened higher, rising around 0.4% in early trade, but later gave up gains to end largely flat.The heavyweight financial stocks were the biggest drag on the session. The Nifty Financial Services and Nifty Bank indices declined 0.5% and 0.4%, respectively, after a four-day rally that saw financials gain 2.8%.Benchmark constituents HDFC Bank and ICICI Bank shed 0.6% and 0.8%, respectively.Information technology stocks outperformed, with the Nifty IT index rising 1.7% on the day, buoyed by optimism surrounding U.S.-China trade negotiations. The sector benefits significantly from U.S. exposure.In the 30-stock Sensex pack, Tech Mahindra, Tata Motors, Infosys, HCL Technologies, IndusInd Bank, UltraTech Cement, TCS, and ITC were among the top gainers , advancing between 1% and 2.3%.Meanwhile, Asian Paints, Bajaj Finance, Tata Steel, ICICI Bank, Maruti Suzuki and Reliance Industries were the biggest laggards on Sensex, falling up to 1.3%.Broader markets edged higher, with the more domestically focused Nifty Smallcap 100 and Nifty Midcap 100 rising 0.1% and 0.01%, respectively.The domestic equity benchmarks traded within a narrow range as investors adopted a cautious approach following the recent rally driven by favourable domestic macroeconomic indicators and concerns over stretched valuations, said Vinod Nair, Head of Research, Geojit Investments."However, the overall sentiments remained on the positive side on account of optimism around U.S.-China trade negotiations. Additionally, a firm U.S. dollar acted as a tailwind for export-oriented sectors, particularly IT and Pharma, which attracted strong buying interest," said Nair.The Nifty has sustained above the previous consolidation zone on the daily timeframe, indicating a continuation of the uptrend, said Rupak De, Senior Technical Analyst at LKP Securities, adding that the positive sentiment is likely to persist and that the sentiment favours long trades as long as the index remains above the key support level of 24,850."On the higher side, the index may move towards 25,350 in the short term, with the potential for an extended rally if it breaks decisively above 25,350. However, a fall below 24,850 could trigger a correction," said De.