Markets snap 2-day winning streak on weekly F&O expiry; Sensex erases 61k, Nifty 50 holds 18,100

Sensex dipped by 187.31 points or 0.31% to end at 60,858.43. Nifty 50 plunged by 57.50 points or 0.32% to close at 18,107.85. During the trading session, the benchmark Sensex and Nifty 50 had touched an intraday low of 60,716.55 and 18,063.75 respectively.

Ajit Mishra, VP – of Technical Research, at Religare Broking, said, “Markets traded dull on the weekly expiry day and ended marginally lower. Weak global cues were weighing on the sentiment from the beginning however continued buying in select heavyweights from banking, energy, and capital goods space capped the decline. Meanwhile, the broader indices remained muted and ended flat to marginally in the red.”

Also, Rohan Patil, Technical Analyst, SAMCO Securities said, on its weekly expiry day on Thursday, (January 19), Nifty witnessed a gap-down opening following the weak global cues and continued to trade in red throughout the day.

In terms of sectoral indices, on BSE, Consumer Durables and FMCG indexes tumbled by over 0.8% each. Meanwhile, the Nifty Media index shed over 1%. Auto and banking stocks too witnessed substantial downside. On the other hand, metal and oil & gas stocks extended their gaining spree.

Major Q3 earnings such as IndusInd Bank, Hindustan Unilever, AU Small Finance Bank, PVR, and Asian Paints among others also weighed on the performance.

Stocks like Tata Steel, Power Grid, Axis Bank, and Tech Mahindra were top gainers. While Asian Paint, IndusInd Bank, Tata Motors, Kotak Bank, Titan, HUL, and Ultratech Cement were top bears with downside ranging from 1-3%.

Further, Vinod Nair, Head of Research at Geojit Financial Services said, “Domestic indices snapped their previous gains amid negative sentiments from their global counterparts. Weak US consumer data and hawkish comments from the Fed’s policymakers on Wednesday hammered investor risk appetite. Lingering fears of recession dragged global bourses down, leaving the market volatile.”

Meanwhile, FIIs pumped in ₹399.98 crore in Indian equities, on the other hand, domestic investors pulled out ₹128.96 crore on Thursday.

At the interbank forex market, the rupee closed at 81.36 against the US dollar compared to Wednesday’s print of 81.24. Rupee tracked other Asian currencies which pulled back as weak US data prompted worries over a slowdown in the economy. The local unit has managed to stay below the 81.50 mark for the second consecutive day.

Going ahead, Mishra added, “Though the market tone has turned positive, the participation is limited to a handful of index majors across sectors. Besides, the lack of traction on the broader front further restricts traders’ options. Traders have no option but to align their positions accordingly and focus on index majors, which are seeing consistent buying interest.”

On the Nifty 50, according to Patil, the benchmark on the daily chart has found resistance near the upper band of the pattern and prices witnessed some profit booking on the expiry day. On the lower time frame, he believes the benchmark may witness a throwback toward the trend line support.

“On the intraday basis, prices cut their 21 EMA but a smart recovery above 18,080 levels help prices to close above its 9 & 21 EMA which is placed at 18,034 & 18,080 levels. The immediate upper band for the index is capped under 18,200 levels and support is placed at 18,035 levels,” Patil added.

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