SBI, Yes Bank biggest losers in banking space; Nifty holds 11,850

Indian market remained under pressure on December 10 largely weighed down by banking stocks, and from the global front, uncertainty around US and China trade talks along with the outcome of US Fed policy meeting on Wednesday kept investors on sidelines.

Banking stocks remained under pressure throughout the trading session after the State Bank of India (SBI) reported bad loan divergence of Rs 11,932 crore for the last financial year, the country’s largest lender said in a notification to exchanges. The stock closed 1.04 percent lower at Rs 313.45.

Let’s look at the final tally on D-Street – the S&P BSE Sensex fell 247 points to 40,239 while the Nifty50 closed with losses of 80 points to 11,856.

Sectorally, the public sector, power, metal, and banking stocks remained under pressure.

Broader market underperformed – the S&P BSE Midcap index fell 1.1 percent while the S&P BSE Smallcap index closed with losses of 1.02 percent.

Investors would now watch out for the inflation data which is due later this week, and the outcome of the US Fed policy on Wednesday. These events could dictate near term trend in the markets.

“We continue to maintain our cautious stance on the Indian markets due to stretched valuations. Going forward, trade developments between US-China, Fed rate decision and election in the UK (Thursday) would dictate the trend for global markets including India,” Ajit Mishra, VP – Research, Religare Broking Ltd told .

“On the domestic front, given the slower growth and higher inflation in the last month, the market participants would keep a close watch CPI, IIP and WPI data scheduled this week,” he said.

Top Nifty gainers: HUL, Cipla, and Bajaj Finance

Top Nifty losers: Yes Bank, ZEE Entertainment, and GAIL India

Stocks & Sectors:

Sectorally, the biggest loser was S&P BSE Public sector, down 1.8 percent, followed by the S&P BSE Oil & Gas (1.7 percent), Metal index (1.38 percent), and Bankex (0.5 percent).

Nifty Bank was down 0.5 percent led by losses in Yes Bank, RBL Bank, IndusInd Bank, Axis Bank, PNB, and SBI.

Volume spike 100-200 percent was seen in stocks like NIIT Tech, Grasim, GAIL India, Just Dial, and Bharat Electronics.

Short Buildup – Apollo Hosp, Ujjivan Financial Services, NIIT Tech, and TCS

Stocks in news:

YES Bank: YES Bank share price declined 10 percent on the back of reports stating that the Rakesh Jhunjhunwala was likely to withdraw the plan to invest in the private lender.

Dilip Buildcon: Dilip Buildcon share price gained after the company emerged as the lowest bidder for Delhi Metro project.

JSW Steel: Shares of JSW Steel ended 3 percent lower after the company reported a 7 percent fall in crude steel output for November 2019.

State Bank of India: Shares of State Bank of India fell one percent after the company reported about Rs 12,000 crore divergence in their bad loans for fiscal 2018-19.

Technical View:

The index formed a bearish candle on daily charts

It closed below its crucial swing low of last week of 11,888 which has now opened room for further downside till 11,740 (50-SMA).

The index closed near its intraday low hence in case it fails to hold onto 11,844 on Wednesday, more correction could be seen.

For time being stability and upsides shall not be expected unless Nifty closes above 11953 levels.

Intraday traders can look to short below 11,850 levels for a target of 11,790 with a stop above intraday high, experts suggest.

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