Market sentiment dampened on lower GDP forecast - Consortium

Nifty declined by 20 points to close at 5938. Nifty slipped nearly 0.66 % from the day's high of 6978. Nifty nosedived over 133 points in six consecutive days. Market sentiment damped after FY13 GDP forecast was reduced to 5% from expectation of 5.5%. Moreover weak Asian markets and NTPC FPO worth Rs120bn keeps the market negative. There was stocks specific action in the market.

Strides Arolab declined by 13% on market rumor of talk that the deal with Pfizer might get delayed or cancelled. Titan has declined by 5% after adverse RBI working group report gold leasing. Others sectors like Realty, Banking, Power, Metal and Capital goods stocks witnessed sharp declines from the intraday high. However, Tech and Auto stocks gained.

Realty stocks witnessed profit booking from higher level (Index down 1.5%). India Bull Real declined by 4% to close at Rs75. Others like DLF, HDIL and Prestige declined by 1-2%.

Metal stocks declined due weak base metal price on LME (index down 1.1%). Tata Steel declined by 2% to close at Rs390. Others like Hindalco, Sterlite, JSW Steel and Jindal Steel declined by 1-3% each.

Tech stocks witnessed fresh buying (Index up 0.8%). TCS gained by 1.2% to close at Rs1387. Tech Mahindra gained by to close at Rs990 due to impressive quarterly result. Both Infosys and Wipro gained marginally.

For the day coming by, Indian markets are expected to open flat on lackluster global cues. The Dow Jones Industrial Average declined 42.47 points. Asian shares were mixed on Friday as investor sentiment was dented by uncertainty over the euro zone economy and following a weak lead from Wall Street. Crude is on a tear and rising prices internationally is a problem for India. Though FIIs buying continues on cash markets, their selling in futures for the last few days is a cause of concern.

Further, heavy selling by DIIs continues unabated to subscribe to ongoing OFS and is putting big pressure on markets. Yesterday Nifty closed below 5940 which technically does not auger well. Nifty has fallen for the last six days and had broken out of the bearish wedge pattern which has a potential target of 5850. Nifty yesterday also felled below important 50 DSMA, which exhibits another sign of weakness. Though the bias is clearly negative, but markets are expected to grind sown slowly and we do not expect a sharp sell-off so aggressive shorts should be avoided. On the upside resistance for spot Nifty is visible at 5951/5965/5978/6000.

Source : Equity Bulls

Keywords