Last hour recovery helps Sensex, Nifty end Feb series on flat note; indices fall 6%


A sharp recovery among financials in the final hour of trade ensured that benchmark indices ended the February series on a flat note as opposed to negative move it witnessed through the day.

Bank Nifty recovered about 170 points from its low points and ended in the green along with a rise in Infosys too. Private banks too aided support to the Street.

The market began the day on a gap-down note, following weak global cues. Implied volatility ahead of F&O series expiry also had investors on their feet. But gains in the past hour negated dips for the Street.

Additionally, automobile stocks and energy dragged the market lower, while some support was also found among information technology (IT) and pharma names.

Having said that, the market had a weak series, losing over 6 percent for February. Meanwhile, Thursday’s fall was the biggest since October 2008 in absolute terms. Nifty Midcap index fell around 10 percent, while the Bank Nifty was weaker by 9 percent. PSU banks were among the top losers, plunging 16 percent in this series.

“It was a volatile day on the bourses as indices flitted between the red and green zones as traders and investors rolled over their futures and options positions to the March 2018 series. However, bargain hunting after the recent sell-off arrested losses and kept strong selling pressure at the bay,” Karthikraj Lakshmanan, Senior Fund Manager – Equities, BNP Paribas Mutual Fund said in a statement.

Among precious metals, gold slumped by Rs 100 to Rs 31,350 per ten gram at the bullion market today on fall in demand from local jewellers and retailers amid a weak trend overseas.

However, silver recovered by Rs 85 to Rs 39,385 per kg on scattered enquiries from industrial units and coin makers.

Marketmen said gold prices sank on muted demand from jewellers following the end of wedding season.

Besides, a weak global trend as minutes from the last US Federal Reserve indicated a hike in interest rates, strengthening the dollar and diminishing the appeal of gold as safe haven, aided the downtrend.

In case of stocks, Mahindra and Mahindra (M&M) ended 2 percent higher after HSBC maintained a buy on 3 and 4-wheeler auto manufacturer and raised the target to Rs 840 from Rs 795 per scrip.

Dish TV jumped 2 percent as research firm Citi maintained a buy on the stock. However, the house cut target of the stock to Rs 90 from Rs 100.

Shares of Escorts gained 2 percent after Credit Suisse maintained its outperform rating on the stock with a target of Rs 1,040.

Britannia’s shares gained around 2 percent as investors cheered Credit Suisse’s initiating coverage on the stock.

Meanwhile, Allahabad Bank ended 1 percent lower after, in a filing to exchanges, the public sector bank declared that it has exposure of over Rs 500 crore to Rotomac group. Further, it clarified that the said amount has been declared as a non-performing asset (NPA) and the required provision has been made.

Among global markets, Asian markets were mixed, after a lower finish in US stocks following the release of the latest Federal Reserve minutes. Meanwhile, European stocks were lower as heightened expectations of faster interest rate hikes in the US hampered risk appetite globally.

“The way things have panned out, on both domestic and global front, in the passing weeks, we do not see any chance of overnight reversal. However, possibility of technical bounce can’t be ruled out, citing oversold positions. Above all, sentiment is still bearish and traders can’t do without short positions. We advise using rebound for fresh shorts while maintaining caution in stock selection. PSU banks and pharma look weak to us while IT and FMCG is showing tremendous resilience so plan accordingly,” Jayant Manglik, President, Religare Broking said in a statement.moneycontrol