The Indian stock markets closed in the red, with the newly-lanched closing auction session continuing to create a divergence among the benchmark indices Sensex and Nifty.
Sensex closed nearly 456 points lower (0.58%) at 78,499 while Nifty 50 fell only 65 points (0.27%) to end the session at 24,571. Border markets were mixed, with Nifty Smallcap 100 closing in the red, while Nifty Midcap 100 gained 0.2%.
Bajaj Finance shares tumbled nearly 6%, while Bajaj Finserv shares plunged over 4% to lead losses on Sensex. ICICI Bank and Trent shares fell nearly 4% each to follow. Bucking the trend, TCS and M&M shares gained 2-4% to lead gains on the benchmark index.
Among the sectors, Nifty Private Bank and Nifty Financial Services dropped more than 1% each. Meanwhile, Nifty Auto jumped around 2%, while Nifty IT gained more than 1%. The overall market breadth slightly favoured the bulls, with NSE seeing 1,685 advances against 1,664 declines, while 119 stocks remained unchanged.
Concerns around Strait of Hormuz reopening plans mount
Iran reviewed a bill to ban US and Israeli vessels from the Strait of Hormuz, where nearly a fifth of the world's oil and liquefied natural gas transmitted before the war began at the end of February. As a result, oil prices inched higher.
Iran is seeking fees of between 5% and 7% of the price of cargoes from ships using the strait, according to the senior Iranian official cited by Reuters. Oman is discussing fees of around 3%, while US wants no fees at all. These developments are further clouding hopes for a peace agreement between the parties, spooking investors.
What lies ahead for Dalal Street?
Market sentiment remains measured as the absence of a definitive geopolitical resolution in the Middle East continues to keep crude oil prices volatile, said Vinod Nair, Head of Research at Geojit Investments. Meanwhile, gold has strengthened on renewed safe-haven demand and a softer U.S. dollar, with investors closely tracking the upcoming U.S. non-farm payrolls data for further clarity on the Fed's policy trajectory, he added.
“Domestically, earnings from several industry bellwethers have been in line with or ahead of expectations, providing a constructive backdrop for sector-specific optimism and investment opportunities. Notably, SBI's strong performance, underpinned by healthy credit growth, improving asset quality and resilient margins, has reinforced confidence in the banking and PSU banking segments, offering an important pillar of support to the broader market outlook,” according to the analyst.
Technical view on Nifty
Going ahead, the immediate resistance for Nifty is placed in the 24,700-24,730 zone, according to SBI Securities. Any sustainable move above this zone could result in Nifty extending its up move towards 24850, followed by 25000 in the short term, it added.
On the downside, the immediate support for Nifty is placed in the 24430-24400 zone, the domestic brokerage said.
(With inputs from agencies)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
