A day ahead of the union budget, Indian benchmark equity indices traded lower on Monday, dragged down by index heavyweights Reliance Industries and banking stocks.
The BSE Sensex was trading 355 points, or 0.44%, lower at 80,247. The Nifty50 was down 148 points, or 0.6%, trading at 24,382 around 9:18 am.
From the Sensex stocks, Kotak Bank, Reliance Industries, JSW Steel, Tata Motors, Axis Bank, and IndusInd Bank opened with cuts. In contrast, UltraTech Cement, Nestle India, HDFC Bank, ITC, Infosys, and Tech Mahindra opened with gains.
Oil-to-telecom conglomerate Reliance shares fell over 2.5% in early trade after the firm reported first-quarter profit below analysts’ estimates on Friday, hurt by lower margins on fuel sales.
Meanwhile, HDFC Bank surged nearly 1% after the country’s top private lender beat quarterly profit forecasts on Saturday, as loan-loss provisions fell.
Wipro shares plunged 8% after the company missed quarterly revenue estimates on Friday due to weak demand in Europe and Asia-Pacific.
Sector-wise, Nifty Realty fell 0.8%, dragged by Phoenix Mills, Lodha, and Sobha. Nifty Bank, Auto, Consumer Durables, IT, and Oil & Gas also opened in the red. Meanwhile, In the broader market, Nifty Midcap100 fell 0.1%, and Nifty Smallcap100 declined 0.15%.
Experts Take
“Going into the Budget the market will be trading cautiously. The pressure on the broader market is likely to continue since there is more scope for profit booking,” said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
“It is important to understand that the market expects a positive Budget which is growth oriented and fiscally prudent with income tax reliefs for the middle class. Also the market expects status quo on the Long Term Capital Gains taxation. If there is any disappointment in these areas the market can react negatively,” Vijayakumar said.
Mandar Bhojane, Research Analyst at Choice Broking, said, “The 24,400 level acts as immediate support; if broken, it could further correct to 24,200 and 24,000 in the coming days. On the flip side, 24,700 and 24,800 act as resistance levels. Due to the budget week, volatility is expected to remain high in the markets.”
Global Markets
Asian shares slid anew on Monday, getting little lift from a surprise rate cut by China’s central bank, while Wall Street futures firmed in the wake of President Joe Biden’s decision to bow out of the election race.
MSCI’s broadest index of Asia-Pacific shares outside Japan lost another 1.0%, having shed 3% last week.
Japan’s Nikkei dropped 1.1%, and South Korea’s benchmark index fell 1.5%. Taiwan was having another tough session with a loss of 2.4%.
FII/DII Tracker
Foreign institutional investors (FIIs) bought equities worth Rs 1,506 crore, while domestic institutional investors sold equities worth Rs 461 crore on July 19.
Oil Prices Rise
Oil prices rose in early trade on Monday as investors keep a lookout for signs of a rate-cut cycle expected to begin as soon as September.
Brent crude prices were up 48 cents, or 0.57%, at $83.10 a barrel, and U.S. West Texas Intermediate crude futures rose 42 cents, or 0.52%, to $80.55.
Currency Watch
The Indian rupee rose 5 paise to 83.65 against the US dollar in early trade. The dollar index, which tracks the movement of the greenback against a basket of six major world currencies, declined 0.09% to 104.3 level.
(With inputs from agencies)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
