The News International Team
Equity benchmarks saw consolidation for the third consecutive session on Wednesday as investors preferred to stay away from taking big position ahead of long weekend.
It was a quiet start to October month. The 30-share BSE Sensex fell 62.52 points to close at 26567.99 and the 50-share NSE Nifty declined 19.25 points to 7945.55 while the broader markets too saw marginal loss.
Experts believe the consolidation may continue in near term with downward bias. According to them, the market will get direction from September quarter earnings (will begin on September 10 with Infosys) and two state elections (Maharashtra and Haryana) in October.
“While we remain positive in the long term, we expect markets to remain rangebound in the near term with a slight downward bias of around 4-5 percent,” said Jyotivardhan Jaipuria, Bank of America Merrill Lynch.
According to Ridham Desai, Managing Director, Morgan Stanley, going ahead, global factors and government action at home, will play key role in market movement.
Once earnings are out of the way, the state elections will be market’s focus. “The BJP is taking risks by going alone in Maharashtra state elections and the market is trying to price in this event. But any adverse election result for BJP in Maharashtra could be a negative cue for the market,” cautions Desai.
For the week, the Sensex and Nifty declined 0.3 percent each, continuing weakness for the second consecutive week while CNX Midcap and BSE Smallcap indices outperformed benchmarks, up 0.6 percent and 1.2 percent, respectively.
The market will be closed from October 2 to October 6 and will reopen on Tuesday after five-day holidays.
Banks, capital goods, oil & gas, FMCG and metals stocks saw selling pressure whereas technology bucked the trend.
Auto stocks were in focus today as these companies declared September sales numbers. Maruti Suzuki topped the selling list, falling over 3 percent as it sold 1.09 lakh units in September, down nearly a percent compared to 1.10 lakh units in previous month and also lower than analysts’ expectations of 1.2 lakh units.
Bajaj Auto declined too, down 0.6 percent despite 18 percent rise in total sales at 3.99 lakh units compared to August. However, Hero Motocorp gained a percent on reporting 30 percent higher sales of two-wheelers in the month gone by. Utility vehicle maker Mahindra and Mahindra surged 2 percent as its total sales increased by 27 percent M-o-M to 44,911 units.
Shares of ITC, Reliance Industries, ONGC, HUL, Tata Steel, Gail, Tata Power and Hindalco Industries were down 1-2.5 percent. Top lenders State Bank of India, ICICI Bank and HDFC Bank dropped 0.5-0.8 percent while Axis Bank gained 0.8 percent.
However, technology stocks topped the buying list with the BSE IT index rising 2 percent ahead of beginning of second quarter (July-September) earnings announcements. Infosys, which will kick off earnings season on October 10, surged 2.66 percent while its rivals TCS and Wipro gained 1.4 percent and 3.22 percent, respectively.
In the broader space, Ashok Leyland and Firstsource Solutions rallied 2 percent each while Bharti Infratel, Opto Circuits, PTC India Financial, Manappuram Finance, Apollo Tyres, HDIL, Jaiprakash Power and Allahabad Bank lost 2-6 percent.
The market breadth was negative; about 1246 shares advanced while 1659 shares declined on the Bombay Stock Exchange.
On the global front, Asian markets closed mixed as investors remained cautious due to ongoing political unrest in Hong Kong. Hong Kong markets will be closed until Friday, while Shanghai markets are shut until October 7.