Nifty Fell for the Third Straight day; IT Index Plunges Over 5%

Mr. Nandish Shah - Deputy Vice President, HDFC Securities

Nifty extended its losing streak to three days amid broad-based selling, spearheaded by IT stocks. Nifty opened with a 73-point gap down, weighed by souring global sentiment and a sharp rise in crude oil prices. The selling pressure remained relentless throughout the day until a minor recovery in the final hour saw the Nifty bounce 100 points off its lows. Despite the late recovery, the Nifty 50 closed 275 points lower at 23,897, culminating in a weekly loss of 1.90%. NSE cash turnover dipped 3% compared to the previous session.

Coal India, Trent, and Hindalco topped the Nifty gainers, while IT heavyweights Infosys, TCS, and Tech Mahindra bore the brunt of the selling pressure to end as top losers.

Selling was across the board with every sectoral index ending in the red; Nifty IT, Media, and Pharma hit hardest. Nifty IT Index plunged over 5% on the back of disappointing quarterly earnings and cautious growth forecasts from heavyweights like Infosys.

Nifty Midcap 100 and Smallcap 100 also saw profit-taking, declining 1% and 0.90% respectively alongside the benchmark. Market breadth weakened further, with the BSE advance-decline ratio at 0.46, signaling ongoing booking in midcaps and smallcaps after their recent rally.

The Indian rupee has hit a rough patch, falling for five straight days and seeing its biggest weekly drop since September 2022. The currency is being squeezed by rising oil prices and a shift in investor sentiment, as Foreign Institutional Investors (FIIs) resume selling after a brief hiatus.

Short term trend of the Nifty turned weak, with the index closing below its 20-day EMA placed at 22937. Next support placed at 23790, followed by 23550. On the higher side, 24200 is the level to watch out for the bullish trend reversal.

Source : Equity Bulls

Keywords

Nifty HDFCSecurities ITStocks CrudeOilPrice