Sensex extends losses for 2nd day in choppy trade; IT, FMCG counters top drags

Mumbai, June 1

The Sensex and Nifty nursed losses for the second straight session on Wednesday, pressured by steep declines in IT, FMCG and pharma counters amid a mixed trend overseas.

High crude oil prices, lacklustre macroeconomic data and foreign fund outflows also played spoilsport.

The 30-share BSE Sensex declined 185.24 points or 0.33 per cent to settle at 55,381.17 in a see-saw session.

On similar lines, the broader NSE Nifty dipped 61.80 points or 0.37 per cent to finish at 16,522.75.

Nestle India was the top loser among the Sensex components, skidding 2.99 per cent, followed by Tech Mahindra, Bajaj Finserv, Sun Pharma, HCL Tech, HUL, PowerGrid and UltraTech Cement.

In contrast, M&M topped the winners’ chart, climbing 1.32 per cent, after the homegrown auto major posted a multi-fold jump in total sales in May.

HDFC rose 0.94 per cent after the mortgage lender announced a 5 basis points (bps) increase in its benchmark lending rate.

Kotak Mahindra Bank, Tata Steel, HDFC Bank, ITC and NTPC were among the other gainers.

The market breadth was negative, with 20 of the 30 Sensex stocks closing in the red.

“Continuous rise in crude oil prices due to EU’s decision to partially ban Russian oil hindered global market. Indian economy registered a growth of 8.7 per cent in FY22 but is expected to slow down in FY23 to 7.2 per cent, as per the latest RBI forecast.

“Auto sales data, posted by major manufacturers, witnessed growth in passenger and commercial vehicle segments due to pick up in the construction sector. However, two-wheeler and tractor segments continued to remain under pressure,” said Vinod Nair, Head of Research at Geojit Financial Services.

The Indian economy grew at its slowest pace in a year during January-March at 4.1 per cent, pulling down the GDP growth in the full fiscal 2021-22 to 8.7 per cent, as per official data released post market hours on Tuesday.

Economists said the outlook for the current fiscal year remains clouded as global crude oil prices have hardened back to USD 120 per barrel after increased sanctions on Russian oil.

Meanwhile, GST revenues bucked a two-month rising trend in May and stood at nearly Rs 1.41 lakh crore, lower than April’s record high of Rs 1.68 lakh crore.

“Benchmark indices made a cautious start amid mixed global market cues. Markets entered green terrain in the late morning session led by strong buying in metal, PSU and oil and gas scrips. But soon the euphoria faded away as sell off in IT scrips dragged the market into negative terrain,” said Mohit Nigam, Head – PMS, Hem Securities.

In the broader market, the BSE smallcap gauge rose 0.62 per cent, while the midcap index declined marginally by 0.10 per cent.

Among BSE sectoral indices, power tumbled 1.70 per cent, followed by utilities (1.51 per cent), teck (1.18 per cent), healthcare (1.16 per cent), realty (1.15 per cent) and IT (1.04 per cent).

However, capital goods jumped 0.75 per cent, industrials 0.70 per cent, bank 0.44 per cent and finance 0.25 per cent.

World stocks were mixed as investors remained anxious about stubborn inflation and expected rate hikes.

Elsewhere in Asia, markets in Shanghai and Hong Kong ended lower, while Tokyo settled in the green.

Bourses in Europe were trading on a mixed note during the afternoon trade. Stock markets in the US had ended lower on Tuesday.

International oil benchmark Brent crude jumped 1.49 per cent to USD 117.27 per barrel.

The rupee on Wednesday recovered from its record low to close 20 paise higher at 77.51 (provisional) against the American currency.

Resuming their selling spree after a one-day breather, foreign institutional investors offloaded shares worth a net Rs 1,003.56 crore on Tuesday, as per stock exchange data.