Stock market today: Nifty 50, Sensex fall about half a per cent each on profit booking; M&M, TCS, HDFC Bank top drags

Stock market today: Indian stock market benchmarks ended in the negative territory on Wednesday, July 10, as investors booked profits in select heavyweights, including Mahindra and Mahindra (M&M), TCS and HDFC Bank.

The Sensex opened at its fresh record high of 80,481.36 but failed to hold altitude and declined over a per cent to touch an intraday low level of 79,435.76. The index finally closed 427 points, or 0.53 per cent, down at 79,924.77.

The Nifty 50 also hit its all-time high of 24,461.05 in early deals and fell over a per cent to the level of 24,141.80. The benchmark index ended 109 points, or 0.45 per cent, lower at 24,324.45.

Shares of Mahindra and Mahindra, TCS, HDFC Bank, Reliance Industries and ICICI Bank ended as the top drags on the Nifty 50 index.

The domestic market benchmarks have found it difficult to hold gains at higher levels amid the lack of fresh triggers. India Inc.'s June-quarter earnings numbers and the Union Budget will be the key factors shaping the market's trajectory from hereon.

Among the global peers, major European markets, including the UK's FTSE, France's CAC and Germany's DAX, and US stock futures were up with healthy gains when the Sensex closed after Fed Chair Jerome Powell, in his testimony to the Senate on Tuesday, highlighted the risks of keeping interest rates high for a longer period. This raised hopes that the US central bank may be moving towards easing monetary policy starting in September. Powell will speak before the Congress on Wednesday.

Mirroring the trends in the benchmark indices, the midcap and smallcap indices also ended in the red. The BSE Midcap index slipped 0.19 per cent, while the BSE Smallcap index dropped 0.69 per cent.

The overall market capitalisation of the firms listed on the BSE fell to nearly ₹450 lakh crore from nearly ₹451 lakh crore in the previous session, making investors lose nearly ₹1 lakh crore in a single session.

Top Nifty 50 gainers today

Out of the 23 stocks that ended in the green in the Nifty 50 index, Asian Paints (up 3.27 per cent), SBI Life Insurance Company (up 2.05 per cent) and Divi's Laboratories (up 1.63 per cent) stood at the top.

Top Nifty 50 losers today

Shares of Mahindra and Mahindra (down 6.69 per cent), Hindalco (down 2.11 per cent) and Tata Steel (down 2.10 per cent) closed as the top losers in the Nifty 50 index.

Sectoral indices today

Nifty Auto index fell 2.02 per cent, ending as the top loser among sectoral indices. Nifty Media (down 1.76 per cent), Metal (down 1.61 per cent), PSU Bank (down 1.40 per cent) and IT (down 1.03 per cent) also lost significantly.

Nifty Bank fell 0.72 per cent and the Private Bank index lost 0.56 per cent.

Expert view on markets

“Markets had been hitting new highs over the past few weeks, and hence, investors resorted to profit-taking because of the stretched valuations of Indian equities. While several sectoral stocks have run up sharply ahead of their fundamentals, the upcoming earnings of many of these companies will show if the rise is justified or not. Also, investors would look to churn their portfolios ahead of the Budget and trim their exposure in risky stocks,” said Prashanth Tapse, Senior VP (Research), Mehta Equities.

Vinod Nair, the head of research at Geojit Financial Services, pointed out that the Indian market experienced profit booking ahead of the upcoming earnings season.

Nair said the expectations are muted given the moderation in sales growth due to a slowdown in the world economy and consolidation in margins driven by high inflation.

Nair added that the market is under temporary risk towards high Budget expectations, which appears to have been factored well into last month's rally.

Technical views on Nifty 50

Shrikant Chouhan, the head of equity research at Kotak Securities, pointed out that on daily charts, the Nifty 50 formed a bearish candle, which indicates weak sentiment is likely to continue in the near future.

Chouhan believes today’s day low, or 24,150/79,400, would act as a key support zone for the day traders.

"If the index succeeds to trade above the same, then it could retest the level of 24,450/80,500. Further upside may also continue, which could lift the index to 24,500-24,550/80,700-80,900. On the flip side, below 24,150/79,400 selling pressure is likely to accelerate. Below this, the market could slip to 24,050-24,000/79,100-78,800," said Chouhan.

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