Profit booking dents equity markets (Roundup)

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Mumbai, May 31 (IANS) Profit booking, coupled with caution ahead of release of key macro-economic data, depressed the Indian equity markets on Tuesday.

The key indices closed the day’s trade flat — marginally in the red — after five consecutive sessions of gains. Selling pressure was witnessed in healthcare, IT (information technology) and FMCG (fast moving consumer goods) stocks.

The wider 51-scrip Nifty of the National Stock Exchange (NSE) slipped by 18.40 points or 0.22 per cent, at 8,160.10 points.

The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 26,817.75 points, closed at 26,667.96 points — down 57.64 points or 0.22 per cent from the previous close at 26,725.60 points.

The Sensex touched a high of 26,837.20 points and a low of 26,561.58 points during the intra-day trade.

The BSE market breadth was skewed in favour of the bears – with 1,582 declines and 990 advances.

The key indices on Monday had closed at their highest levels since October 2015. The equity markets had risen for the fifth consecutive session led by short covering, along with expectations of healthy quarterly results and higher crude oil prices.

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The barometer index had edged up by 72 points or 0.27 per cent, while the NSE Nifty had gained by 21.85 points or 0.27 per cent.

Initially on Tuesday, the key indices opened on a higher note, in-sync with their Asian peers.

Despite the positive opening, the equity markets soon ceded their initial gains on the back of profit booking.

Besides, investors were seen reluctant to chase prices ahead of the release of key domestic and global macro-economic data points.

The major domestic macro-economic data points like the fourth quarter GDP (gross domestic product), fiscal deficit and eight core industries (ECI) are expected to be released later on Tuesday.

These key data points can give further cues towards a rate decision by the Reserve Bank of India (RBI) in its monetary policy meet scheduled on June 7.

However, short covering and low level value buying aided the key indices to pare some of their losses.

“Nifty gave flat closing ahead of GDP data which is going to be published later in the evening. Auto sector stocks like Tata Motors and Maruti witnessed good buying sentiments,” Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

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Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services pointed out that equity markets were able to pare some of their losses on the back of short covering.

“Short covering aided markets to recover from the day’s lows. It was triggered in anticipation of healthy Q4 GDP figures,” James told IANS.

According to Nitasha Shankar, Senior Vice President for Research with YES Securities, broader markets also witnessed profit booking in line with the headline indices.

“Auto, metal, PSU bank and realty indices continued to gain strength ending with handsome gains. Pharma, IT and FMCG indices dragged the markets lower,” Shankar noted.

In the day’s trade, the foreign institutional investors (FIIs) turned net sellers, while the domestic institutional investors (DIIs) bought stocks.

Data with stock exchanges showed that the FIIs sold stocks worth Rs114.52 crore, whereas the DIIs purchased scrip worth Rs60.28 crore.

Sector-wise, healthy buying was witnessed in automobile, banking and metal stocks. On the other hand, scrip of healthcare, IT and FMCG witnessed heavy selling pressure.

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The S&P BSE automobile index augmented by 442.32 points, followed by the banking index, which gained by 134.57 points; and the metal index rose by 91.22 points.

In contrast, the S&P BSE healthcare index plunged by 215.48 points, followed by the IT index, which declined by 145.59 points; and the FMCG index fell by 98.15 points.

Major Sensex gainers during Tuesday’s trade were Tata Motors, up 8.95 per cent at Rs458.20; Tata Steel, up 3.51 per cent at Rs334.45; State Bank of India (SBI), up 3.12 per cent at Rs204.85; Maruti Suzuki, up 2.33 per cent at Rs4,167.90; and HDFC, up 1.30 per cent at Rs1,246.50.

Major Sensex losers during the day’s trade were Sun Pharmaceuticals, down 6.13 per cent at Rs762.70; GAIL, down 2.31 per cent at Rs370.85; Tata Consultancy Services (TCS), down 2.29 per cent at Rs2,575.10; ITC, down 1.40 per cent at Rs351.60; and Bharti Airtel, down 1.33 per cent at Rs351.65.



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