The BSE Sensex fell 553 points, or 0.69%, to close at 79,389, while the National Stock Exchange’s Nifty50 declined 135.5 points, or 0.56%, to 24,205.35. The Nifty50 fell more than 6% in October — the sharpest drop in a month for four-and-a-half years — as weaker-than-estimated earnings by companies in the quarter ended September 30 raised questions about the pace of the recent run-up in the market.
“The market is in a phase where there is a lot of reallocations hap pening with investors moving out from themes whose earnings have disappointed,” said Hemang Jani, founder-director at equity advisory firm Finazenn. “That said, I do not think the market is likely to correct much from these levels.” The market will have a special 60-minute Muhurat trading session on Friday to mark the start of the new Hindu year.
The Nifty must surpass the current hurdle of 24,500 for the market to start an uptrend at least for the moment, according to analysts.“A strong close above this range is needed before considering aggressive positions, as the market seems poised for a phase of high volatility,” said Rajesh Bhosale, an equity technical analyst at Angel One. If the index falls below the support range of 24,100–24,000, it could result in the Nifty weakening further to the 23,500 level, he said.
Software exporters were the biggest losers in Thursday’s trading with HCLTech and Tech Mahindra dropping more than 3.6% each, after the US economy grew slower than anticipated in the quarter ended September 30.
Tata Consultancy Services, Infosys and Wipro all declined 2-3%, while the Nifty Information Technology Index slumped 3%. Among gainers, drugmaker Cipla soared 9.5% and infrastructure major Larsen & Toubro gained 6.2%.
Sentiment in the broader market was much more optimistic with the Nifty Smallcap 250 index jumping 1.5% and the Microcap 250 index advancing 2.1%. The Nifty 150 index ended 0.2% lower. Of the 4,026 stocks traded on the BSE, 2,652 advanced, while 1,264 declined. Foreign portfolio investors net sold shares worth `5,813 crore, taking their sales tally in October to `1,09,800 crore. Domestic institutions, including mutual funds and insurers, were buyers of shares worth `3,515 crore. In October, they were buyers to the tune of Rs 1,10,500 crore, cushioning the market from sharper declines.
