Bears back on D-St! Sensex down by over 400 points; Nifty holds 11,200

The bears took control of D-Street on July 29, pushing benchmark indices towards the crucial support levels. The S&P BSE Sensex fell more than 400 points but managed to hold on to the 38,000 level while the Nifty held on to 11,200 level.

The S&P BSE Sensex fell 421 points to end the day at 38,071 while the Nifty50 ended 97 points lower at 11,202.

Profit booking after the recent rally, US Fed meeting, a rise in coronavirus cases and mixed earnings capped the upside, experts say.

“Indian indices gave up gains and closed in the negative with profit-booking seen in the recent outperformer RIL,” Vinod Nair, Head of Research at Geojit Financial told .

Global markets were undecided ahead of the US Fed Reserve meeting. Mixed earnings reports and rising virus cases forcing economies to reconsider restrictions also weighed on sentiment.

“Stock-specific action was also visible, post-earnings results and this trend is expected to continue. Adequate liquidity in the market should ensure that these corrections are bought into,” Nair said.

Sectorally, action was seen in healthcare, metal, telecom, and capital goods while selling pressure was visible in energy, auto, and oil & gas space.

The broader markets outperformed the benchmarks. The S&P BSE Midcap index rose 0.68 percent while the S&P BSE Smallcap index closed with gains of 0.43 percent .

Top Nifty gainers included Tata Steel, IndusInd Bank and Dr Reddy’s Laboratories.

Top Nifty losers included M&M, HCL Technologies, Nestle India and RIL.

Stocks & Sectors

Sectorally, the S&P BSE Healthcare index rose 2.1 percent followed by the S&P BSE Metal index that was up 0.98 percent and the S&P BSE Telecom index closed 0.69 percent higher.

Selling pressure was seen in the energy index that fell 3 percent followed by the auto index that was down 1.2 percent and the BSE oil & gas index closed with a loss of 1.08 percent.

A volume spike of more than 100 percent was seen in REC, Colgate Palmolive, and RBL Bank.

Long buildup was seen in stocks like Colgate Palmolive, PFC and BHEL.

Short buildup was seen in stocks like BPCL, TCS and Maruti Suzuki.

More than 100 stocks on the BSE hit a fresh 52-week high. These included Dr Reddy’s Laboratories, TCS, MCX India, MindTree and Jubilant Life Sciences.

Stocks in news

Dr Reddy’s Laboratories stock jumped over 6 percent after the company reported a 12.6 percent year-on-year (YoY) drop in consolidated net profit at Rs 579 crore for the quarter ended June 2020.

Maruti Suzuki India share price shed over a percent after the company posted a net loss of Rs 249.4 crore for the June quarter.

IDBI Bank stock price jumped 5 percent after the lender reported a standalone net profit of Rs 144.43 crore for the June quarter.

Jet Airways shares shed 5 percent after the company posted a weak set of numbers for the financial year 2019.

Sasken Technologies stock surged 14 percent after the company posted 200 percent QoQ jump in Q1 net profit at Rs 28.3 crore against Rs 9.4 crore.

Tata Coffee share price jumped over 12 percent after the company declared its June quarter numbers.

Technical View

The Nifty formed a bearish candle on the daily chart. It bounced back from 5-Days EMA placed at 11,189

The Nifty surpassed the previous day’s high of 11,317 but in the absence of buying, took the index to retest the low of 11,150.

The Nifty is stuck in a range between 11050 and 11350 and requires a decisive breakout with follow-up action to commence the next leg of rally, Chandan Taparia of Motilal Oswal Financial Services Limited said.

“Now, it has to continue to hold 11,150 zone to extend its move towards 11,350 then 11,500 zones while on the downside, key support exists at 11,050 levels,” he said.