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Market Report

Monday, 07-Sept-2015

NSE

  • The S&P BSE Sensex plunged over 300 points in trade on Monday to slip below its crucial psychological level of 25,000, while NSE Nifty cracked below its crucial support level of 7550 in the last one hour of trading. The Sensex finally closed 308.09 points lower, or -1.22 per cent, at 24,893.81 today. It hit a low of 24,851.77, and a high of 25,387.32 in trade today. The 50-share Nifty index closed 96.25 points lower, or -1.26 per cent, at 7,558.80 today. It hit a low of 7545.90, and a high of 7705.05 in intraday trade.

  • The market opened for the week on a promising note in the morning, with the Sensex rallying over 100 points on strength seen in Asian markets. But as the session progressed, both benchmarks gave up all the gains to turn flat, before the bears took over in the last two hours of trade.

  • Benchmark indices fell like a pack of cards in the last 30-60 minutes of trade, weighed down by heavy selling in pharma, IT, realty, power, FMCG, auto, and banking stocks. This is the sixth straight session of downside after the rupee hit a fresh 2-year low of 66.83 against the US dollar, while growth concerns in China dampened investor sentiment. Further, persistent selling by foreign institutional investors at higher levels and weak monsoon forecast also weighed on the markets.

  • The idea is to be very stock-specific till you get some kind of a pullback rally where you can take a short position on the index for the time being, but overall, it looks like a market which might settle around 7460-7450 thereabouts, says Mitesh Thacker. Volatility will remain for some more time, he says.

  • The way our markets plunged today (Monday) after a big fall on Friday is worrisome, says Neeraj Dewan of Quantum Securities. So, there is short- term pressure in the market, and that is quite visible. I feel that volatility will continue and there can be a short-term impact on the markets. I still strongly believe that the downside will be limited, and I am not seeing a massive selling from these levels. I do not feel there can be a 10% downside from these levels, maybe a couple of percentage, he added. Dewan is of the view that when the bounce-back happens, it will be pretty sharp. In 2013, the market had fallen 14% in the month and then recovered 20% from the bottom. Even then, the news was global in nature because of QE withdrawal talks and everything.

NIFTY 3-Month

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