Indian equity indices ended on a lower note denting the investors’ sentiments as it faced a sell-off on all the counters on Monday due to global pressure. The NSE Nifty 50 fell 662 points or 2.68%, from its previous close, to settle the day’s trading at 24,056, testing the psychological level of 24,000. While the BSE Sensex plunged 2,222 points or 2.74% to 78,759. All the sectoral indices closed the day in the red. 

Sectoral Index

Bank Nifty slipped 1,258 points or 2.45% to end the session at 50,092. Similarly, Nifty Midcap 100 dropped more than 2050 points or 3.55% settling the day’s trading at 55,857. In the broader markets, smallcap and midcap stocks closed in the red.

“Domestic equity indices came under the grip of global markets carnage as a host of external factors like recession fears in the US on the back of weak jobs data, an interest rate hike in Japan leading to an impact on Yen-carry trade and a raging Middle East conflict triggered massive sell-off across the board. Such corrections in the past were temporary and we saw the market rebounding fast. But we fear that this time it will be quite different from history. Our advice for traders is trading positions should be trimmed or strict stop losses should be observed on either side of trade and option writers should be careful. Investments with a 2/3-year horizon can be considered to allocate funds in a phase-wise manner,” said Prashanth Tapse, Senior Vice President of Research at Mehta Equities.

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“We are of the view that the current market texture is weak and volatile but due to temporary oversold conditions, we could expect one intraday pullback rally. For the day traders now, 24000/78500 would be the immediate reference point. Above the same, we could expect intraday pullback up to 24150-24250/79000-79300. On the flip side, below 24000/78500 the selling pressure is likely to accelerate. Below the same, it could retest the level of 23900/78300. Further downside may also continue which could drag the index till 23800/78000,” said Shrikant Chouhan, Head of Equity Research at Kotak Securities.

Bank Nifty 

“The bank Nifty has also breached and closed below the previous swing low of 50440 suggesting a continuation of the fall and is likely to drift lower towards 47650 – 47500 where the 200-day moving average is placed. The 20-week moving average is placed at 49800, which can provide some relief however rallies towards 50400 – 50500 should be used as a selling opportunity,” said Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas.