Equity markets slip on global cues, profit booking

5 Dariya News

Mumbai 21-Sep-2016

The Indian equity markets on Wednesday closed flat, as the initial gains were pared by a last hour bout of profit booking.In addition, investors sentiments were dented by caution ahead of the US rate decision, expected later at night. Heavy selling pressure was witnessed in FMCG and banking stocks.The wider 51-scrip Nifty of the National Stock Exchange (NSE) inched up by 1.25 points or 0.01 per cent, to 8,777.15 points.In contrast, the barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 28,554.38 points, closed at 28,507.42 points -- down 15.78 points or 0.06 per cent from the previous close at 28,523.20 points. The Sensex touched a high of 28,689.36 points and a low of 28,462.33 points during the intra-day trade. However, the BSE market breadth was marginally tilted in favour of the bulls -- with 1,417 advances and 1,311 declines.On Tuesday, the benchmark indices ended in the red due to caution ahead of major global financial events and profit-booking.

The barometer index had slipped by 111.30 points or 0.39 per cent, while the NSE Nifty edged down 32.50 points, or 0.37 per cent."The equity markets were largely positive during the intra-day trade as hopes of a rate-hike turned down in the US Fed meet. This had enhanced the risk-taking appetite," Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services, told IANS."However, investors were not willing to push prices higher as caution still prevailed ahead of the FOMC (Federal Open Market Committee) final decision. The Bank of Japan (BoJ) decision (to keep its policy balance rates unchanged) did not have much impact on the domestic markets."Initially on Wednesday, the benchmark indices opened on a flat-to-positive note in sync with their Asian peers.Besides, sentiments were buoyed after the BoJ announced new monetary policy measures.

Moreover, domestic cues such as the proposal to merge the general and railway budget, along with consultations to advance the budget presentation date, provided some support to the equity markets. However, the key indices capped gains as caution prevailed ahead of the decision of the US Fed's FOMC meet.The global and domestic markets are cautious as the decision could provide cues to a possible rate-hike in December.A rate-hike can potentially lead FPIs (Foreign Portfolio Investors) away from emerging markets such as India, and is also expected to dent business margins as access to capital from the US will become expensive.According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, the CNX Nifty traded with volatile sentiments throughout the trading session ahead of US Federal Reserve's rate decision."IT and banking stocks faced profit booking at higher levels in the second half of the session and traded with mixed sentiments. Pharma and auto stocks also traded with mixed sentiments," Desai said.

"FMCG and oil and gas stocks traded with mixed sentiments on selling pressure. Sugar stocks failed to sustain at higher levels and traded down due to profit booking."The rupee weakened by a paise to 67.02 against a US dollar from its previous close of 67.01 on Tuesday.In terms of investments, provisional data with the exchanges showed that the foreign institutional investors (FIIs) purchased stocks worth Rs 183.85 crore, whereas the domestic institutional investors (DIIs) divested scrip worth Rs 230.59 crore.Sector-wise, the S&P FMCG index declined by 51.25 points, followed by the banking index, which receded by 42.45 points, and the capital goods index fell by 21.15 points.On the other hand, the S&P BSE consumer durables index surged by 107.15 points, the automobile index gained 56.24 points, and the metal index rose by 51.34 points.Major Sensex gainers during Wednesday's trade were: Tata Steel, up 1.05 per cent at Rs 369.30; Hindustan Unilever (HUL), up 1 per cent at Rs 912.20; Axis Bank, up 0.85 per cent at Rs 598; Bharti Airtel, up 0.69 per cent at Rs 322; and Wipro, up 0.64 per cent at Rs 483.25.Major Sensex losers were: Power Grid, down 1.46 per cent at Rs 175.35; ITC, down 1.26 per cent at Rs 253.80; State Bank of India (SBI), down 1.14 per cent at Rs 251.35; ICICI Bank, down 0.86 per cent at Rs 269.65; and ONGC, down 0.68 per cent at Rs 256.