Today, the Nifty50 index closed 0.4 per cent lower at 18,114.9 points, while the BSE-Sensex closed at 60,821.6, down 0.2 per cent. For the week, the benchmark indices fell a little over 1 per cent. During the four-day sell-off in the market, investors’ notional wealth has declined by Rs 10.3 lakh crore.
A volatile day on the Street saw the benchmark indices open on a positive note but give up those gains by mid-day. The BSE-Sensex gyrated over 850 points from the day’s high to the day’s low reflecting the indecisiveness among investors.
The sell-off during the week was led by retail investors who sought the exit door after the sudden collapse in shares of IRCTC on Tuesday dampened risk appetite. However, the selling has come along with a decline in volatility indicating that investors are not counting on further weakness in the weeks ahead.
Sentiment among investors has also been soured by the weak operating performance by India Inc so far with prominent companies like Hindustan Unilever and Asian Paints raising alarm bells of unprecedented input cost inflation, which has crimped their margins.
“The conditions are set to ensure that inflation will sustain at high enough level and eventually policymakers will end up surprising markets somewhat nastily. Which is why purely as a risk investor, it makes sense to be somewhat cautious,” Maneesh Dangi, macro investor and advisor told ETNow today.
In the broader market, the selling pressure was more pronounced as the Nifty Midcap 100 and Nifty Smallcap 100 index ended 0.9 per cent and 1.25 per cent. For the week, both the indices have fallen 5 per cent each.
On the sectoral front, banks again found favour among investors due to their reasonable valuations as compared to the broad market. The Nifty Bank and Nifty Financial Services index closed 0.7 per cent and 0.6 per cent higher, respectively, to outperform the Nifty50.
Shares of IT stocks saw selling pressure on account of profit booking and as investors are rotating funds away from stocks that are expensively priced. Similarly, shares of metals and pharma names also took a beating on concerns valuations have run ahead of business fundamentals, said analysts.
Shares of ITC fell over 3 per cent along with other tobacco stocks on media reports that the new panel may recommend increasing retail prices of cigarettes by as much as 75 per cent from their current levels to discourage smoking.
Overall, the breadth of the market was weak as nearly two stocks fell for every one stock that rose on the National Stock Exchange.
