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Market Report

Wednesday, 06-May-2015


  • The S&P BSE Sensex finally closed -2.63 per cent lower at 26,717.37 with a massive loss of 722.77 points. It hit a low of 26,677.64 and a high of 27,501.15 in trade today. The 50-share Nifty index ended -2.74 per cent lower or 227.80 points down at 8,097.00 today. It hit a low of 8083.00 and a high of 8331.95 in intraday trade.

  • Tracking the extreme weak stock market sentiment, the total investor wealth of BSE-listed companies plummeted by Rs 2.89 lakh crore to Rs 99.11 lakh crore. The Sensex plunged 723 points -- its second biggest single day fall since Narendra Modi government took over -- on huge sell-off by FIIs on concerns over GST and other reforms. This is the biggest single day fall in last four months after 855 points plunge on January 6. Besides, this is the second-biggest since Modi government took over on May 26, 2014.

  • India's long-term story remains intact despite the S&P BSE Sensex plunging over 700 points in trade today to breach its crucial psychological support level of 27000, and the Nifty breaking its 200-DMA, say experts. Investors who had missed out on the rally that began in May last year following arrival of the Modi-led NDA government can take advantage of the recent, even ongoing, downward correction to build a long-term stock portfolio, they advise.

  • We would have still gone down even if GST would be passed, etc, says Ashwani Gujral. Why? Because we had become overextended on a big timeframe. And large players who control that timeframe have decided that they would like to reduce their weightage to the country and that is what is happening. I mean we can blame it on x or y or z, but this sort of large correction always happens and when large players sell their holding, chances are that we should head towards 7500 to 7700. It is a decent time to go short, he adds.

  • The biggest and the most resilient space has been the small and midcaps, says Shankar Sharma of First Global. They have not done too badly at all and that has been my view that the large caps are over baked. They are overdone. There is no big theme or big play that I have seen in large caps over the last few months. Small caps have been buzzing. That is where the real money is going to be made, he says.

  • Immediate target for Nifty is at 7,935-7,940, says Mitesh Thacker. Post Wednesday's trade, one can expect Bank Nifty to test 17,500 levels. Those levels appear to be the next-short term target. So, I would continue to trade with a negative bias. Buying into put options on the indices could be good strategy. While on the individual stock side, as and when they are breaking below their earlier swing lows, they could be good short trades, he says.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)