Stock Market Falls For 2nd Day: Sensex Sheds 299 Points, Nifty Below 19,700. ITC Slips 4%, FMCG Drags

Stock update: On the 30-share Sensex platform, ITC plunged 3.87 per cent. Kotak Bank, TechM, JSW Steel, Tata Steel, HUL were among the other losers

The two key equity benchmarks, Sensex and Nifty, on Monday closed in red for the second straight day due to losses in index heavyweights ITC and Reliance Industries. Some IT and metal shares also settled in the negative zone under extreme selling pressure. The S&P BSE Sensex, which oscillated between gains and losses for a major part of the trading day, ended with a loss of 299 points at 66,385. On the other hand, the NSE Nifty50, which hit a high of 19,783, and then dipped to a low of 17,658, eventually settled 73 points lower at 19,672.

On the 30-share Sensex platform, ITC plunged 3.87 per cent after the company’s board gave its in-principle approval for demerge of the hotel business. The board also approved incorporation of a wholly-owned subsidiary, ITC Hotels Limited. Kotak Bank, TechM, JSW Steel, Tata Steel, HUL were among the other losers. On the flipside, IndusInd Bank, M&M, PowerGrid, Bajaj Finserv, Ultracemco, L&T emerged gainers.

In the broader market, the BSE Midcap index advanced 0.3 per cent, while the Smallcap index added just 0.1 per cent.

Overall, the market breadth was marginally negative, with more than 1,900 shares declining versus 1,760-odd advancing stocks on the BSE.

Sectorally, FMCG index shed nearly 2 per cent, and oil & gas, banks and metals declined 0.5 per cent each. On the other hand, power and capital goods indices up 0.5 per cent each.

In the previous session on Friday, the S&P BSE Sensex plunged 888 points, (1.3 per cent) to end the session at 66,684, while the NSE Nifty50 settled at 19,745, down 234 points (1.17 per cent). It touched a low of 19,700.

"Sectorwise setbacks were experienced in IT and FMCG, unveiling weak demand and high input costs. Banks are mixed while pharma stocks are withholding the volatility in anticipation of better demand from developed economies, reduction in US pricing issues and expansion in operating margins. Investors are also watchful of the upcoming FOMC meeting, addressing rate hike and quantitative tightening measures, which could have an implication on FIIs inflows," Nair said.

Elsewhere in Asia, equity markets were mixed with Nikkei gaining 1.23 per cent, while Hang Seng and Shanghai Composite declined by 2.13 per cent and 0.11 per cent, respectively. Europe markets were also trading mixed. German benchmark DAX was up 0.08 per cent while London's FTSE 100 gained 0.06 per cent. The CAC 40 of France was off 0.18 per cent. The US markets ended higher on Friday with S&P 500 gaining 0.03 per cent.

Global oil benchmark Brent crude was trading 0.73 per cent higher at $81.66 per barrel.

Foreign institutional investors (FIIs) were sellers on Friday as they offloaded equities worth Rs 1,998.77 crore, according to exchange data.

Meanwhile, the rupee gained 15 paise to close at 81.83 (provisional) against the US dollar on Monday, as a sharp jump in India's forex reserves boosted investor sentiments. At the interbank foreign exchange market, the local unit opened at 82 against the US dollar and moved in a range of 81.82 to 82.04 in day trade.

The rupee closed 15 paise higher at 81.83 (provisional) against the previous close of 81.98 on Friday. The Indian rupee gained on softening crude oil prices and a sharp jump in India's forex reserves, said Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas.