Mumbai, Aug 1 (IANS) Profit booking, along with lower crude oil prices and upcoming global events risks, dragged the Indian equity markets lower during the mid-afternoon trade session on Monday.
The key indices receded after touching their new intra-day highs in almost a year, as heavy selling pressure was witnessed in capital goods and banking stocks.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) slipped by 3.10 points or 0.04 per cent to 8,635.40 points.
The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 28,083.08 points, traded at 28,017.35 points (at 2.00 p.m.) — down 34.51 points or 0.12 per cent from the previous close at 28,051.86 points.
The Sensex has so far touched a high of 28,284.85 points and a low of 27,873.53 points during the intra-day trade.
The BSE market breadth was tilted in favour of the bears — with 1,545 declines and 1,067 advances.
On Friday, the benchmark indices closed the day’s trade in the negative territory due to profit booking, negative global cues and foreign fund outflows.
The barometer index plunged 156.76 points or 0.56 per cent, while the Nifty slipped by 27.80 points or 0.32 per cent.
Initially on Monday, the benchmark indices opened on a higher note, in sync with their Asian peers.
The upward trajectory also got a boost from the increased chances of the GST (Goods and Services Tax) Bill getting passed during parliament’s ongoing monsoon session.
Investors are hopeful about the bill’s passage after the Union Cabinet last week approved key changes in the proposed legislation.
The pan-India tax reform has been passed by the Lok Sabha but is stuck in the Rajya Sabha, where the government lacks a majority.
Besides, positive macro economic data — the Purchasing Managers’ Index (PMI) — which showed an acceleration in manufacturing sector’s growth, unleashed fresh buying spree.
However, profit booking, lower crude oil prices and anxiety over upcoming macro-economic data dragged the equity markets lower.
In addition, depreciation in rupee’s value and caution ahead of major global events risks such as Bank of England’s (BoE) monetary policy review and US jobs data subdued investors’ sentiments.
“Profit booking and a steep decline in banking sector stocks dragged the equity markets lower,” Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services, told IANS.
“However, the key indices opened on a higher note, aided by positive Asian markets, strong closing from last week and expectations of GST bill getting through.”
According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, CNX Nifty faced profit booking at higher levels.
“Bank Nifty and most pharma stocks traded down due to profit booking, while IT sector stocks held the initial gains on back of fresh buying support,” Desai noted.
“Sugar and aviation stocks traded with mixed sentiments due to profit booking. However, lower USD/INR prices are likely to limit the downside.”