Sensex trades 100 points down; IT stocks zoom

Mumbai, July 21 (IANS) Major first-quarter results and the start of the monsoon session of parliament subdued the Indian equity markets, with a barometer index trading 100 points down during the late-afternoon trade session on Tuesday.

Bucking the general trend, however, the information technology (IT) and technology, entertainment and media (TECK) scrips made healthy gains. The S&P BSE IT index rocketed up by 566.06 points and TECK index soared by 272.27 points.

The benchmark index of the Indian equity markets, the 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE), was trading down 99.58 points or 0.35 percent during the session.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading in the red. It was lower by 27.35 points or 0.32 percent at 8,576.10 points.

The Sensex of the S&P Bombay Stock Exchange (BSE), which opened at 28,381.82 points, was trading at 28,320.54 points (at 2.35 p.m.), down 99.58 points or 0.35 percent from the previous day’s close at 28,420.12 points.

The Sensex so far touched a high of 28,518.06 points and a low of 28,317.27 points in the intra-day trade.

“The lackluster performance is due to stock-specific action on account of the first quarter results. Other triggers for the subdued movements are the anxiety surrounding the monsoon progress and the start of the parliament session,” Anand James, co-head, technical research, Geojit BNP Paribas told IANS.

Major results like Infosys, HDFC Bank and Sun Pharma have been released till now which have had an impact on stock- or sector-specific indices.

Investors were also anxious about the ability of the government to pass key bills like goods and services tax (GST) and land bill during the monsoon session.

According to James, markets were also nervous about the upcoming futures and options (F&O) expiry on July 30 and the RBI’s monetary policy review which will be conducted on August 4.

“The upcoming monetary policy review which will decide a cut in key lending rates are also making the markets nervous. This might be the last chance for the Reserve Bank of India to cut lending rates before inflation spirals up again and the US Fed decides on its own rates in September,” James added.

The Reserve Bank of India (RBI) had said that any rate cut decision will be based on the progress of the monsoon and prevailing data points.

According to the India Meteorological Department (IMD), the monsoon so far has been six percent below its long-term average. This has become another concern for the markets.

However, IMD has given an optimistic forecast of a better performance during early August. Monsoon rains are important for agriculture as a large part of the arable land is rain-fed — and a variation in rainfall not only affects crop production but also rural incomes and inflation.

Sector-wise, healthcare, banks, oil and gas, fast moving consumer goods (FMCG) and consumer durables stocks came under intense selling pressure.

The S&P BSE healthcare index plunged 960.05 points, bank index lost 215.78 points, oil and gas index receded by 117.04 points, FMCG index was lower by 97.63 points and the consumer durables index fell by 77.67 points.

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