Mumbai, India (BBN) – Domestic shares snapped a two-session winning streak to end lower on Monday as software service exporters took a hit on concerns over a stronger rupee, and as investors took a breather after the NSE index hit a record high last week.
The broader NSE index ended 33.2 points or 0.36 per cent lower at 9,126.85, reports The Hindu Business Line.
It hit a record high of 9,218.40 on Friday.
The benchmark BSE index closed down 130.25 points or 0.44 per cent at 29,518.74.
BJP’s decision to appoint Yogi Adityanath as UP Chief Minister, valuation concerns, the G20 decision to drop a pledge to avoid trade protectionism and a decline on Wall Street on Friday dampened investor sentiment.
Among BSE sectoral indices, IT index fell the most by 1.36 per cent, followed by TECk 1.23 per cent, oil & gas 0.52 per cent and banking 0.42 per cent.
On the other hand, consumer durables index was up 1.03 per cent, healthcare 0.44 per cent, realty 0.25 per cent and PSU 0.23 per cent.
Top five Sensex losers were Axis Bank (-2.41 per cent), ICICI Bank (-1.99 per cent), Infosys (-1.87 per cent), TCS (-1.82 per cent) and Wipro (-1.59 per cent), while the major gainers were NTPC (+0.87 per cent), Coal India (+0.76 per cent), Bharti Airtel (+0.76 per cent), HDFC Bank (+0.63 per cent) and Lupin (+0.62 per cent).
Idea Cellular slumped 9.6 per cent as traders said the implied deal price in a planned merger with Vodafone PLC’s Indian operations under-valued the company shares.
Although traders had initially reacted positively to the news, doubts about Idea’s valuations after the merger sent shares downward, according to traders.
Still, overall sentiment remains positive on hopes for additional economic reforms from the government.
India’s cabinet approved four bills to implement a planned Goods and Services Tax (GST), a government official said on Monday, paving the way for the country to implement the landmark tax reform from July.
But concerns about share valuations and a lack of big events are likely to keep trading rangebound, analysts said.
“We have moved to an event vacuum stage as the quarterly results are some two-three weeks away.
We have little of major events now.
After testing the 9,200 levels (in Nifty), markets have little to fuel further rally. Investors are looking for bargains,” said Anand James, chief market strategist at Geojit Financial Services.
Marketmen have raised concerns over the Centre’s future reform policies in view of appointment of Yogi Adityanath as the Chief Minister of the country’s most populous state.
Marketmen are particularly concerned about any large-scale selling by the foreign investors who tend to react promptly to any such development.
However, Some analysts are hopeful that macroeconomic factors such as further movement on the GST rollout decision would eventually decide the course for the stock market, after a temporary hit from the development in Uttar Pradesh.
IT sector accounted for around 50 per cent of the losses on the Nifty50 index, led by Infosys Ltd which was down around 2 per cent.
The rupee strengthened slightly to 65.4124/4150 per dollar, not far from the near 17-month high of 65.2250 hit last week, raising concerns about overseas returns in the sector.
World stocks opened the week on a cautious footing on Monday after the G20’s decision to drop a pledge to avoid trade protectionism, while the US Federal Reserve’s conservative rate guidance continued to push the dollar lower.
Asian stocks were mixed, European stocks fell as much as 0.3 per cent and US futures pointed to a fall of around 0.2 per cent at the open on Wall Street.
The dollar fell to a six-week low, falling four days in a row for the first time since early November.