Buy-the-dip bulls seem to be taking a break given the several uncertainties that are hovering around and many are wondering if this is the start of the much talked about correction that is long overdue. While this will only be known in hindsight but there is every reason to increase cash allocation in portfolios, said an analyst.
“The Indian market continues to mirror global weakness, albeit with a much lesser impact. Energy stocks could continue to remain in focus amidst the weakness and we remain positive on PSU stocks. Realty stocks would be a good bet to accumulate amidst the weakness,” said Sageraj Bariya, Vice President – Institutional Sales, East India Securities.
How are bluechips doing
After opening in the red, benchmark indices slipped further lower. At 12.40 pm, BSE flagship Sensex was down 521 points or 0.88 per cent to 58,603. NSE benchmark Nifty declined 152 points or 0.86 per cent to 17,466.
“Nifty50 could possibly break support levels of 17,600 and 17,500 in early trade and the new immediate support shall lie near 17,400 levels. Resistance could be seen around 17,700,” said Mohit Nigam, Head – PMS, Hem Securities.
In the 50-share pack Nifty, Power Grid was the biggest gainer, up 1.71 per cent. Indian Oil, ONGC, M&M, Bajaj Auto, NTPC, Bharat Petroleum, Coal India and Divi’s Labs were among other gainers.
Hindalco was the top loser in the pack, down 2.05 per cent. Maruti Suzuki, Bajaj Finserv, HDFC Bank, Adani Ports, Sun Pharma, Titan, Bharti Airtel and ICICI Bank were among those that traded in the red.
FACTORS DRIVING MARKETS
Good news
Yields, dollar cool off: The benchmark 10-year Treasury note continued to rally in Tokyo trading, with the yield sliding to the lowest since Sept. 28 at 1.48 per cent. The dollar index, which measures the currency against six major rivals, was off Thursday’s one-year high of 94.504, last changing hands at 94.326.
Bad news
Gas price hikes: The government has hiked gas price ceiling by 62 per cent that will hurt industries relying on it. Ceramics and fertiliser industries will be among those affected. GAIL may also see some impact.
Japan sees risks: Bank of Japan policymakers in September saw rising risks to the economy from slowing Chinese growth, semiconductor shortages and Southeast Asian factory shutdowns, which could affect growth projections at its next policy-setting meeting.
China remains a concern: China has proved a particular worry for investors, hit by regulatory curbs in the tech and property sectors, and now grappling with a power shortage that threatens to push up energy prices globally.
Broader markets
Broader market indices were trading mixed, outperforming their headline peers in morning trade. Nifty Smallcap was up 0.07 per cent while Nifty Midcap declined 0.13 per cent. Broadest index on NSE,…
Read More: Sensex drops over 500 points: Key factors plaguing market