It was another day of consolidation on Dalal Street as equity benchmarks started the session on a positive note but wiped out those gains in afternoon trade to close marginally lower, weighed down by crash in Chinese shares.
The 30-share BSE Sensex fell 46.73 points to 27831.54. The 50-share NSE Nifty declined 10.75 points to 8466.55 after hitting an intraday high of 8525.75 and low of 8433.60. However, the broader markets outperformed benchmarks, supported by retail and HNIs. The BSE Midcap gained 0.5 percent and Smallcap rose 0.9 percent.
The market breadth remained positive throughout the session as about 1633 shares advanced against 1234 shares declined on the Bombay Stock Exchange.
Experts expect consolidation in market for some more time due to lack of triggers. They see the Nifty in range of 8400-8800 in near term.
Short-term volatility due to the Chinese yuan or the Chinese markets is likely to continue, from a day-to-day perspective, said Robert Parker, investment strategy and research, Credit Suisse.
He continued to remain cautious on the Indian markets.
Global markets were under pressure due to China worries. Shanghai Composite index accelerated losses in late trade, falling 6.15 percent after the China’s central bank injected the largest amount of cash into the financial system in a single day in 19 months. Hang Seng lost 1.4 percent. Among European markets, France’s CAC, Germany’s DAX and Britain’s FTSE declined 0.2-0.7 percent (at 16 hours IST).
Back home, Moody’s cut India’s growth forecast to 7 percent for 2015 against 7.5 percent earlier because of lower than expected monsoon rainfall. However, the rating agency maintained its forecast for 2016 at 7.5 percent.
Prime Minister Narendra Modi announced special package of Rs 1.25 lakh crore for Bihar ahead of polls. He also announced an additional Rs 40,000 crore for infrastructure development including electricity, rural roads and highways.
Technology and select auto & PSU banks supported the market while oil, metals, healthcare and private banking & financials shares remained under pressure.
Infosys climbed 2 percent as brokerage BNP Paribas gave thumbs up after investor meetings with the CFO Rajiv Bansal. It has maintained its buy rating with the increased target price of Rs 1,320 on the back of a Q1 earnings beat and a weaker rupee. TCS, too, gained 1.9 percent.
Banking major State Bank of India continued to see buying interest, up 1.8 percent. It surged 10.7 percent in last four consecutive sessions, largely aided by PSU revamp plan Indradhanush and hopes of rate cut post continued deflation in July. However, ICICI Bank and HDFC Bank closed marginally lower. Housing finance company HDFC fell again, down 1 percent after stake sale in HDFC Life.
Among others, L&T, Maruti Suzuki, Mahindra & Mahindra and Tata Steel climbed 1-2 percent. However, Coal India and GAIL topped the selling list, down more than 4 percent. Lupin, Sun Pharma, Tata Motors, Cipla, ONGC, Bharti Airtel, Vedanta and Hindalco were down 1-3 percent.
In the broader space, Sharon Bio Medicine shot up 20 percent after the USFDA inspected & audited company’s Dehradun (in Uttarakhand) formulation plant last week. Rajesh Exports rallied 5.8 percent on order worth Rs 1,170 crore from Al Malek Jewellery, UAE.
Harrisons Malyalam (up 11.6 percent) and Tata Coffee (up 7 percent) saw major buying interest as sources said the Department Of Industrial Policy & Promotion finalised note on allowing 100 percent FDI in coffee sector. DIPP also finalised note on FDI in rubber sector.