Nifty turns negative for 2019; investors lose Rs 2.38 lakh cr in a day

Indian equity market suffered strong losses on September 17 due to a widespread selloff as depreciating rupee and geo-political tensions spooked investor’s sentiment.

Global crude oil prices eased slightly but remained on the elevated levels while the threat of retaliation over the attacks on Saudi oil facilities kept investors on tenterhooks.

The poor health of Indian currency dented investor sentiment. The Indian currency closed 19 paise down at 71.78 per dollar.

“Something which was supposed to happen yesterday unfolded today. Spike in crude makes our yields and import big worries. Already sliding growth will get further impacted due to these reasons,” Sameer Kalra, Founder of Target Investing.

Sensex closed the day with a loss of 642 points, or 1.73 percent, at 36,481.09, with only Hindustan Unilever, Asian Paints and Infosys in the green.

With this, the market benchmark extended the losses into the second consecutive session.

The selloff in equities dragged the cumulative market capitalisation of BSE-listed firms to Rs 1,39,70,356.22 crore on September 17 from Rs 1,42,08,049.05 crore in the previous session, making investors poorer by Rs 2.38 lakh crore in a day. In the last two sessions, investors have lost about Rs 2.73 lakh crore.

Hero MotoCorp, Tata Motors, Axis Bank, Tata Steel, Maruti Suzuki and State Bank of India closed the day as the top losers in the Sensex.

In sync with the Sensex, BSE Midcap and Smallcap indices fell 1.77 percent and 1.84 percent, respectively.

The Nifty50 ended 186 points, or 1.69 percent lower at 10,817.60. Among the 50 stocks in the index, 44 incurred losses.

Both Nifty and Nifty Bank turned negative for the Calendar 2019. Nifty Bank index closed 723 points or 2.60 percent down at 27,131.75.

All sectoral indices on BSE suffered losses. The auto and realty pack plunged 3.80 percent and 3.69 percent, respectively.

Top news of the day:

A blast killed 24 people and injured 31 others near an election rally held by Afghan President Ashraf Ghani in central Parwan province.

Traders body CAIT said there is no slowdown in the domestic automobile sector and the industry is making hue and cry only to get a package from the government.

The Delhi High Court has transferred all cases pertaining to Aircel-Maxis scam, involving P Chidambaram and his son, from Special Judge OP Saini to Special Judge Ajay Kumar Kuhar, who is trying INX-Media cases against the father-son duo.

During a visit to his home state Gujarat, Prime Minister Narendra Modi offered prayers to goddess Narmada at the Sardar Sarovar dam on his 69th birthday. Modi offered prayers as part of the state government’s Namami Devi Narmade Mahotsav celebrations being held to mark the dam receiving water to its full capacity.

Union Home Minister Amit Shah said the Modi government will not tolerate breach of India’s territory and is ready to deal with such acts as strongly as possible.

Karnataka Congress leader DK Shivakumar approached the Delhi High Court, seeking copy of his statements recorded by the Enforcement Directorate in a money laundering case.

The deposits of over 6 crore EPFO members will get 8.65 percent interest in 2018-19, Labour Minister Santosh Gangwar said.

Stocks in news:

Shares of State Trading Corporation of India (STC) plunged 19.61 percent to Rs 107.40 while those of MMTC cracked 16.57 percent to Rs 20.65 on BSE on September 17 after media reports indicated the government may shut down these firms.

Shares of Eicher Motors fell 2.89 percent to close at Rs 16,274.25 after Elara Capital retained its sell call on the stock and cut price target by 6.6 percent, citing weak demand and subdued festive season.

Shares of Bharti Airtel fell 1.18 percent to Rs 339.85 after reports that talks to sell stake in merged tower company has begun. The telecom operator has begun talks to sell stake in merged company of Bharti Infratel and Indus Towers, reports CNBC-TV18 quoting unnamed sources.

Shares of Tata Communications rebounded smartly and closed 5 percent higher at Rs 273 after its land bank was demerged into a separate company.

Titan Company shares settled 0.88 percent up at Rs 1,158.60 despite a widespread selloff in the market after global research firm Morgan Stanley upgraded the stock to overweight from equal weight with a target of Rs 1,300 from Rs 1,110 per share.

Shares of FMCG major Godrej Consumer Products gained over 1.28 percent to close at Rs 645.95 after global research firm Morgan Stanley maintained an overweight call on the stock with target at Rs 860 per share.

Shares of GVK Power & Infrastructure declined 4.81 percent to Rs 4.55 after the company’s arm terminated a concession agreement with NHAI.

Global updates:

Global markets were lacklustre ahead of an expected interest rate cut from the US Federal Reserve on September 18 and the next round of US-China trade talks on September 19.

Oil shed some of its massive gains as US flagged the possible release of crude reserves, but the threat of military action over the attacks on Saudi oil facilities kept prices elevated and stocks under pressure, Reuters reported.

Among the Asian peers, Shanghai Composite Index closed 1.74 percent down at 2,978.12, while Kospi and Nikkei ended flat at 2,062.33 and 22,001.32, respectively.

Technical view on the market:

Nifty closed the day with a strong loss, forming a Bearish Belt Hold pattern on the daily chart. The index has given fresh breakdown from its pennant pattern on the daily chart.

“As long as the index trades below 10,900, we may see some more cuts in the index towards 10,650 in the near term. Immediate support for Nifty is coming near 10,800-10,750 and resistance is coming near 10,860-10,920. Any decisive close above 10,920 can again activate bullish momentum,” said Rohit Singre, Senior Technical Analyst at LKP Securities.Get access to India’s fastest growing financial subscriptions service Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the website or mobile app.