Profit booking and an endeavour to recover from the hangover of last week’s Brexit (Britian’s exit from the European Union) led the key Indian equity indices to end on a flat note on Monday, despite positive cues from their Asian peers.
Heavy selling pressure was particularly witnessed in information technology (IT) and TECK (technology, media and entertainment) sectors.
The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 26,347.81 points, closed at 26,402.96 points — up a paltry 5.25 points or 0.02 per cent, against the previous close at 26,397.71 points.
It touched a high of 26,493.51 points and a low of 26,262.72 points during the intra-day trade.
The BSE market breadth was skewed in favour of the bulls — with 1,820 advances and 793 declines.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) inched up to 8,094.70 points — up a mere 6.10 points or 0.08 per cent.
On Friday, the equity markets plummetted on the back of negative global cues and a sharp drop in rupee’s value. The barometer index plunged by 604.51 points or 2.24 per cent, while the Nifty dropped by 181.85 points or 2.20 per cent.
Initially on Monday, the key indices opened on a flat note — marginally in the red — as investors’ sentiments remained weak on account of the volatility caused in the global markets due to Britain’s vote to exit from the European Union.
This also resulted in a sharp drop in the rupee’s value and dried up foreign fund inflows.
However, the Indian markets gained some momentum shortly after and started trading in the green as the Asian markets, especially the Nikkei, showed a considerable recovery by shrugging off the global selloff stimulated by the Brexit.
The rupee, after a major fall of 71 paise on Friday, managed to wipe out its losses and helped the equity markets to support its weakened sentiments. Hopes of healthy monsoon have also contributed to the behaviour of the markets.
The investors were still seen to be cautious, ahead of the US trade data to be released later on Monday, and GDP and consumer confidence data to be released a day later. The Indian markets are also expected to remain cautious ahead of some major industrial data to be released later during the week.
“The Indian markets have taken cues from the global markets today. Basically, today’s market behaviour is the follow-up of the Brexit that happened last week. After a sharp decline on Friday, the rupee is also showing some strengthening,” Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services, told IANS.
According to Shreyash Devalkar, Fund Manager – Equities, BNP Paribas Mutual Fund, the Indian equity markets remained range-bound during the day’s trade due to concerns over developments in the European region, but succumbed to profit booking and closed flat.
Sector-wise, the S&P BSE healthcare index got augmented by 300.75 points, followed by the capital goods index, which surged by 232.18 points; and the consumer durables index gained by 119.24 points.
On the other hand, the IT index plunged by 210.41 points, followed by the TECK index, which fell by 100.71 points, and the automobile index slipped by 48.34 points.
Major Sensex gainers during Monday’s trade were: Dr.Reddy’s Lab, up 2.87 per cent at Rs 3,240.65; State Bank of India (SBI), up 2.77 per cent at Rs 217.10; Sun Pharmaceuticals, up 2.67 per cent at Rs 773.90; Cipla, up 2.62 per cent at Rs 489; and Larsen and Toubro, up 2.36 per cent at Rs 1,467.50.
Major Sensex losers were: Tata Consultancy Services (TCS), down 2.93 per cent at Rs 2,495.35; Infosys, down 2.37 per cent at Rs 1,166.25; Asian Paints, down 1.48 per cent at Rs 974.05; Wipro, down 1.23 per cent at Rs 549.10; and Bajaj Auto, down 1.02 per cent at Rs 2,651.60.