Bears remained in control of D-Street for the third consecutive day in a row to hit a fresh 2-month low on July 22. Sensex managed to hold on to 38,000 towards the close after it breached the level intraday. Nifty got support near its 200-day exponential moving average (EMA).
Selling in heavyweights like HDFC twins, ITC, and Bajaj Finance kept the market under pressure. Banking stocks remained under pressure with Nifty Bank recording a fall of nearly 500 points or 1.63 percent.
In terms of sectoral losers, the S&P BSE Finance index fell 2.2 percent, followed by the S&P BSE FMCG index that was down 1.4 percent, and the S&P BSE Bankex that was down 1.4 percent.
In the broader market, S&P BSE Smallcap index fell 1.1 percent, while the S&P BSE Midcap index was down by 0.6 percent.
The fall in the benchmark indices was largely due to muted global cues, mixed earnings from India Inc. that reflected signs of a slowdown in the economy, persistent selling by foreign investors, and fall in key heavyweight stocks in the banking pack.
The market is likely to remain volatile ahead of the F&O expiry on July 25 The next big support for the index is placed at 200-day exponential moving average placed at 11,294, and below that 200-day moving average level placed at 11,127.
But, after witnessing a fall from a high of 11,982 on July 5, the index is trading near key support levels and should ideally see a technical bounce back, suggest experts.
“Nifty should see a bounce from current levels after a sharp fall from the high of 11,982 over the past 13 days,” Vikas Jain, Senior Research Analyst, Reliance Securities told Moneycontrol.
“Volatility in the market will be high concerning F&O expiry this week and earnings of individual stocks. On the higher side, 11,480-11,500 will act as strong resistance for Nifty over the next few days,” he said.
Stocks in news:
RIL rose 2.5 percent after it reported a consolidated profit after tax of Rs 10,104 crore for the June quarter, up 6.8 percent from a year ago.
Shares of Kotak Mahindra Bank fell 3 percent despite brokerages said the lender is expected to report healthy growth in June quarter.
HDFC Bank shares fell 3 percent after moderate weakness in Q1 asset quality and a slowdown in retail loan growth, but brokerages remained positive on the stock.
Shares of Oriental Bank of Commerce (OBC) shed 2 percent despite the company posted a profit of Rs 112.7 crore in the quarter ended June 2019 (Q1FY20).
Cipla was down over 1 percent after the US drug regulator issued seven observations to the Bengaluru facility.
Shares of Avanti Feeds surged 7 percent after the company posted better numbers for the quarter ended June 2019.
Asian markets ended lower with Shanghai Composite shedding 1.27 percent at 2,886.97, Nikkei slipped 0.23 percent to 21,416.79, while Kospi ended marginally lower at 2,093.34.