Metals lead fall; Broader market under pressure

Benchmark indices closed in the red on Tuesday after a volatile session.

The market opened on a negative note amid weak global cues and remained volatile through the day, oscillating between gains and losses. Indices closed lower with metals leading the fall.

The BSE Sensex closed at 54,364.85, down 105.82 points or 0.19 per cent. It recorded an intraday high of 54,857.02 and a low of 54,226.33. The Nifty 50 closed at 16,240.05, down 61.80 points or 0.38 per cent. It recorded an intraday high of 16,404.55 and a low of 16,197.30.

Breadth favours decliners

The market breadth remained in favour of the decliners with 2,476 stocks declining on the BSE against 879 that advanced, while 132 remained unchanged. Furthermore, 11 stocks hit the upper circuit as compared to the five stocks that were locked in the lower circuit. Besides, 146 stocks touched a 52-week low level and 57 touched a 52-week high.

Vinod Nair, Head of Research at Geojit Financial Services, said, “The resistance of the Indian market has started to move in tandem with the world market. The support from DII and retail investors is reducing after heavy sell off unbalancing their optimism.”

“A fall in financial liquidity is expected to slow down the economy and the pricing of equities. Oil prices are declining further on worries of Chinese lockdown, rising dollar and risk of recession. Metal stocks are losing its shine as the sector’s outlook is turning negative due to persisting margin pressures,” Nair added. 

Bulls lose out

S Ranganathan, Head of Research at LKP securities, said, “A weakening rupee despite forex swaps by the Central bank failed to lift IT stocks even after good deal wins and management commentary post-earnings.”

“FMCG stocks saw investor interest today as Bulls attempted to halt the famous adage — Sell in May and Go Away. The Metal Index, however, played spoilsport for the Bulls. The Indices in no way represented the damage done today in the broader markets, with the Advance-Decline ratio describing the weak undertone,” he added. 

Hindustan Unilever, Asian Paints, IndusInd Bank, Ultratech Cement and Eicher Motor were the top gainers on the Nifty 50 while Coal India, Tata Steel, ONGC, JSW Steel and Hindalco were the top losers. 

Private bank stocks, FMCG in focus

On the sectoral front, while financials and FMCG gained, metals, consumer durables, pharma, realty, oil and gas, and IT dragged.  

Nifty Bank and Nifty Financial Services were up 0.60 per cent and 0.54 per cent, respectively, at closing while Nifty Private Bank was up 0.75 per cent. Nifty FMCG was up 0.49 per cent.

Meanwhile, Nifty Metal fell over 5 per cent while Nifty Realty was down nearly 3 per cent. Nifty Consumer Durables and Nifty Oil & Gas were down over 2 per cent each. Nifty Pharma and Nifty Healthcare Index were down over 1 per cent each while Nifty IT was down 1 per cent. 

Broader indices 

The broader market also remained under pressure.

Nifty Midcap 50 was down 1,76 per cent while Nifty Smallcap 50 was down 2.44 per cent. The S&P BSE Midcap was down 1.98 per cent while the S&P BSE Smallcap was down 2.11 per cent. 

The volatility index rose 1.22 per cent to 22.30.

Published on May 10, 2022