Sensex, Nifty run out of steam, snap 4-week winning streak

By Koustav Das: Benchmark stock market indices fell for the second consecutive session on Friday, registering a weekly loss after four weeks as investor sentiment soured.

The S&P BSE Sensex closed over 259 points lower at 62,979, while the NSE Nifty 50 fell 105 points to settle at 18,665.

The weekly decline marks the biggest one since late April, indicating that benchmark indices could face a period of consolidation. Selling pressure was also seen in midcaps and smallcaps, which fell over 1 percent.

One of the concerns highlighted by analysts is the fact that many stocks are currently trading at stretched valuations and could experience some consolidation in the coming weeks.

Among the sectoral indices, only Nifty Pharma managed to end in positive territory, while all others fell. Nifty Metal was the biggest loser, down nearly 2.5 percent.

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Nifty Media also fell over 2 percent, while Nifty Oil & Gas and Nifty Auto fell over 1 percent each.

Riches Vanara, Technical and Derivatives Analyst at Stoxbox, said, “Today, the stock market ended in the red, with the Sensex falling around 250 points and the Nifty shedding around 100 points. Major sectors were in negative territory, barring pharma. The IT sector was hit due to Accenture lowering the top-end of CC growth guidance to 9 percent from 10 percent.”

The top five gainers on the Nifty 50 were IndusInd Bank, Dr. Reddy’s, Asian Paints, Bharti Airtel, and NTPC. On the other hand, the top losers were Adani Enterprises, Adani Ports, BPCL, Hindalco, and Divi’s Laboratories.

Shares of Adani Group’s 10 listed companies declined between 1.5 to 7 percent after reports suggested that the US Attorney’s Office in Brooklyn, New York, is inquiring about investors holding large stakes in the conglomerate.

“The entire Adani Group witnessed a sharp decline amidst reports of the US attorney’s inquiries into investors with large stakes. Presently, investors may be deterred by the elevated valuations of stocks, which could influence their decision to exercise caution for the time being,” said Vanara.

Meanwhile, Eros International Media faced a bloodbath, ending 19.9 percent lower after the Securities and Exchange Board of India (SEBI) barred parent Eros Group’s managing director Sunil Arjan Lulla and three of the group’s units from the securities market.

V.L.A. Ambala, SEBI Registered Research Analyst at Stock Market Today (SMT), stated, “For Nifty, support levels are 18,620, 18,533, and 18,405. Resistance levels are 18,755 and 18,840. The Sensex may face resistance on Monday at 63,310 and 63,470, while major support levels are 62,805 and 63,560.”

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