Tuesday, February 27, 2024
Tuesday, February 27, 2024
HomeBusinessSensex scores 523 points on profit-taking in banking, metal stocks

Sensex scores 523 points on profit-taking in banking, metal stocks

Mumbai: Benchmark index Sensex plunged 523 points on Monday amid profit-taking in banking and metal stocks amid mixed trends in global markets.

The 30-share BSE Sensex closed 523 points or 0.73 per cent lower at 71,072.49 as 22 of its constituents closed in the red and eight in the green. The barometer opened higher and hit a high of 71,756.58 in early trading.

However, profit taking in Reliance Industries, metal giants and banking stocks dragged the index to a low of 70,922.57 during intraday trade.

The broader NSE Nifty also closed 166.45 points or 0.76 per cent lower at 21,616.05 with 34 of its components ending in the red.

Select metal, banking and oil sector stocks succumbed to selling, while pharmaceutical and IT stocks bucked the trend.

“An increase in foreign exchange margin requirements led to a decline in positions, mainly in mid-cap and small-cap companies. Apart from pharma and IT sectors, selling was widespread, with notable difficulties seen in PSU banks,” Vinod Nair, Head of Research, Geojit Financial. Services said.

In the Sensex group, Tata Steel fell the most by 2.76 per cent, followed by NTPC (2.72 per cent) and SBI (2.26 per cent). Private banks IndusInd, Kotak Bank, HDFC Bank and ICICI Bank also fell.

On the contrary, Wipro, HCL Tech, Mahindra & Mahindra and Nestle were among the nine Sensex stocks that bucked the trend.

The BSE small-cap index fell 3.16 per cent, while the mid-cap index lost 2.62 per cent and the large-cap index closed down 0.90 per cent.

Among sectoral indices, utilities saw the steepest decline of 3.60 percent, followed by real estate which declined 3.01 percent and energy which fell 2.90 percent. Industrial sectors fell 2.92 percent and energy fell 2.80 percent, while metals fell 2.73 percent and oil and gas fell 2.56 percent.

Capital goods, raw materials, bankex and financial services were other laggards.

“The premium valuation gap between mid- and large-cap companies has reached an all-time high. Despite a strong economic forecast, corporate earnings are expected to slow due to subdued operating margins. It’s going to be a challenge for the market in general to sustain the premium valuation,” Nair added.

In the broader market, NHPC fell 15.81 per cent after reporting a 19 per cent drop in its profits for the December quarter. Another PSU, SJVN, fell 20 per cent to reach the lower circuit on BSE.

Leading forging manufacturer Bharat Forge plunged 14.04 per cent after announcing its quarterly results.

“Nifty fell further after a consolidation breakout on the hourly chart, indicating a rise in pessimism. The daily chart shows the index forming a lower high, indicating a decline in bullish sentiment,” Rupak said De, Senior Technical Analyst at LKP Securities.

In Asia, Tokyo’s Nikkei 225 closed up 0.9 percent and China’s Shanghai Composite rose 1.28 percent. Hong Kong’s Hang Seng fell 0.83 percent.

European markets were trading mixed, with France’s CAC 40 and Germany’s DAX rising, while London’s FTSE 100 was trading lower.

Global benchmark Brent crude fell 0.50 percent to $81.78 a barrel on Monday.

Foreign institutional investors (FIIs) bought shares worth Rs 141.95 crore on Friday, according to exchange data.

On Friday, Sensex rose 167.06 points or 0.23 per cent to settle at 71,595.49 points, while the Nifty gained 64.55 points or 0.30 per cent to close at 21,782.50 points.

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