Sensex fails to hold 40,300; telecom stocks ring loud

Indian equity benchmarks ended in the red on November 18, snapping the winning run of the last two consecutive sessions as investor sentiment remained subdued due to the lack of major positive triggers.

The Indian market opened higher but lost steam soon and traded in the lower territory for the major part of the day. The Sensex failed to hold 40,300 mark and eventually closed 73 points, or 0.18 percent, lower at 40,284.19, while the Nifty slipped 11 points to end at 11,884.50.

The loss of the broader market was capped by positive global sentiment as global markets traded near record highs after Beijing cut a key interest rate for the first time since 2015.

Back home, BSE Midcap and BSE Smallcap indices outperformed the benchmark Sensex, closing with gains of 0.44 percent and 0.27 percent, respectively.

On the sectoral front, BSE Telecom logged a strong gain of 3.42 percent, followed by Metal, Healthcare and Basic Materials that rose over a percent each.

On the other hand, Capital Goods, Auto, IT, Energy and FMCG were among the sectors that ended marginally lower today.

Experts say the US-China trade talks, crude oil prices and the movement of Indian currency will be the key factors that will steer the mood of the market.

“With a lack of any major positive triggers both on the domestic and global front, we continue to maintain a cautious stance on the Indian markets. In the near-term, investors will keep an eye on the progress of trade talks between US-China, the behaviour of crude oil prices and fluctuation in currency. We would advise investors to focus on fundamentally sound companies with strong financials and healthy prospects,” said Ajit Mishra, Vice President – Research, Religare Broking.

Top Nifty gainers: Bharti Airtel, Tata Steel and UPL rose up to 4 percent.

Top Nifty losers: Yes Bank fell 4 percent, followed by Britannia Industries and Bajaj Auto, both falling almost 2 percent.

Stocks in news:

Reliance Communications: Reliance Communications share price touched its 52-week low of Rs 0.57, falling more than 3 percent after the company’s chairman Anil Dhirubhai Ambani tendered his resignation as director of the company.

BPCL: Bharat Petroleum Corporation (BPCL) share price ended with gains of over 3 percent after the government said it is aiming to sell their stake in the company by March 2020.

Glenmark Pharma: Glenmark Pharma share price surged over 21 percent after global research firm CLSA had upgraded the stocks to buy from sell and raised the target to Rs 410 from Rs 350 per share.

Tata Steel: Tata Steel share price gained 4 percent after the company completed stake sale in NatSteel Vina Co Ltd (NSV). It signed an agreement with the Vietnam-based Thai Hung Trading joint-stock company to divest its entire equity stake held in NSV (56.5 percent).

Volume spike of 100-300 percent was seen in stocks like BPCL, PFC, Muthoot Finance, Concor and Glenmark Pharma.

Long Buildup – Glenmark Pharma, Vodafone Idea, Bharti Airtel

Short Buildup – Siemens, Concor, Hero MotoCorp

Technical View: The price action of Nifty over the last few sessions suggests that the market is in the state of flux for the near-term.

“The structure is developing as a complex correction as per the Elliott Wave Theory. The next leg of the correction is expected over the next few sessions as long as Nifty trades below the near-term resistance zone of 11,973 – 12,000,” said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan by BNP Paribas.

This means that the last week’s low of 11,802 is likely to be breached on the downside over the next couple of sessions and the index can tumble down to 11,700-11,600 subsequently. The short term momentum indicator is attempting to complete the correction cycle back to the equilibrium line, which is in line with the price structure, Ratnaparkhi further said.

Three levels: 11,867.6, 11,946.2, 11,931.27

Max Call OI: 12,000, 12,200

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