Shrugging off the positive trade in global markets, domestic market remained under pressure as investors are cautious over the economic slowdown amid rising coronavirus cases over the last few days. There are also higher uncertainties over the possibility of govt announcing another relief package, denting investors’ sentiments.
The benchmark indices opened on a positive note but the bourses turned negative in the afternoon session due to sell-off in Bank Nifty and ended in the red territory with a decline of 0.9 percent. All sectoral indices ended in red except energy and infra. The BSE Midcap and Smallcap indices fell 1 percent each.
There were major selloffs in FMCG, pharma and banking indices. Bharti Infratel, M&M and Power Grid ended as top gainers while SBI, Bajaj Finance and Britannia were the top laggards. Crucial events which can impact market for this week include services PMI data, govt’s measures to combat the impact of economic lockdown extension and the US, China relationship.
Slumping over 810 points from the day’s high, the 30-share BSE index settled 261.84 points or 0.83 percent lower at 31,453.51, and the NSE Nifty fell 87.90 points or 0.95 percent to close at 9,205.60.
State Bank of India (SBI) was the top laggard in the Sensex pack, shedding over 4 percent, followed by Bajaj Finance, Asian Paints, Axis Bank, Kotak Bank and ICICI Bank.
Sumeet Bagadia, Executive Director, Choice Broking said, “It is the second consecutive day that the Index has given a negative close at 9,212-level with the loss of 80 points. On a daily chart, the index has formed an Abandon Baby Candlestick which is a bearish reversal formation and indicates a downside movement. At present level, the index has strong resistance at 9450 while downside good support comes at 9,170-9,000-level,” he said.
The indices witnessed profit booking post 2-PM and ended lower for the second consecutive day on Tuesday. Financials, auto and aterials stocks came under selling pressure, said Deepak Jasani, Head Retail Research, HDFC Securities. “The moves to reopen economies shut down to help curb the coronavirus pandemic helped boost oil prices, with the US benchmark jumping 10 percent-its longest run of gains in nine months. Many European countries that have seen new infections tapering off amid strict social distancing measures and nationwide lockdowns have begun relaxing some restrictions.
“European stocks trimmed an advance after Germany’s top judges gave the European Central Bank three months to fix its asset-purchase program. The German judges said that some parts of the quantitative-easing program aren’t backed by European Union treaties. Poor macro data continued to pour in. Prices at factory gates in the 19 countries sharing the euro fell 1.5 percent month-on-month in March and 2.8 percent year-on-year. Hong Kong’s economy shrank 8.9 percent year-over-year in the first quarter, its worst showing since 1974.
“Technically, with the Nifty correcting further after the sharp correction seen in the previous session, the bears remain in control for the near term. Further downsides are likely once the immediate support of 9191 is broken towards 8909. Any pullback rallies could find resistance at 9,396,” Jasani said.
Rupee settles 10 paise higher
The Indian rupee surged 10 paise to close at 75.63 (provisional) against the US dollar on Tuesday, amid higher domestic equity markets and gains in some Asian currencies.
Forex traders said the rupee is trading in a narrow range as positive domestic equities supported the local unit, while sustained foreign fund outflows and concerns over coronavirus outbreak weighed on the local unit, according to a PTI report.
At the interbank foreign exchange, the rupee opened at 75.62, and finally settled at 75.63, registering a rise of 10 paise over its previous close.
#Rupee ends slightly higher at 75.62 against the US dollar pic.twitter.com/KrkFaBqgN1
— CNBC-TV18 (@CNBCTV18Live) May 5, 2020
During the day the domestic unit saw an intra-day high of 75.50 and a low of 75.72 against the US dollar.
On Monday, the rupee had settled at 75.73 against the US dollar.
Domestic bourses were trading on a positive note with the benchmark Sensex trading 85.45 points higher at 31,800.80 and broader Nifty 15.30 points at 9,308.80.
“Other Asian currencies have also started with gains against the US Dollar this Tuesday morning amid risk appetite returned to the market as many countries planned to ease the restrictions on the lockdown enforced due to the COVID-19 pandemic,” Reliance securities said in a research note.