Profit-booking topples markets from historic highs

Last Updated: Thu, May 23, 2019 17:55 hrs
Bull Sculpture (Image Courtesy: Bloomberg)

Mumbai: Domestic indices on Thursday could not hold on to their momentum even as they soared to all-time highs during the intra-day session.

The thirty scrip sensitive Sensex set a fresh high. The Sensex set a high of 40,124.96, nearly a peak of 800 points at 11:00 AM. However, the index lost all the momentum built during the first half of the trading session. By the end of the session, the Sensex traded to 38,811.39, down by 0.76% or 298.82 points.

A similar trend was observed on the Nifty, a fifty scrip sensitive index. The Nifty settled to 80.85 points or 0.69% at 11,657.05.

Initial trends from D-Street suggested of a massive gain for Indian markets. This, sensing the lead set by the BJP government during the counting session. The results were yet to be announced at the time of the markets ending. However by mid-noon, all domestic indices turned negative.

Slipping from highs:


A heatmap of thirty scrips traded on the Sensex. Chart as of end of day trading session. Source:Bombay Stock Exchange

Brokers suggest that the day saw some profit booking coming at higher levels.

"Indian equity market as expected touched the historic figure of 12,041 and made a new all-time high. Markets seem to have discounted the magical mandate in favour of BJP. At the same time, we see there is some profit booking that is coming in at higher levels," said Mustafa Nadeem, CEO, Epic Research to IANS.

"Broader market health is improving but we are seeing lack of momentum and hence expecting consolidation in the near term," said Sahaj Agrawal, Head of Derivatives, Kotak Securities.

On the Bombay Stock Exchange, most broader indices were trading marginally in the red in a range of 0.10-0.30%.

Of the 2687 companies traded, 1167 stocks advanced while 1347 declined. 68 stocks soared to their 52 week highs while 148 posted a 52 week low.

Among sector specifics, telecom and capital good stocks fared better. Metals, and technology stocks turned in among the most losing in the session.

On the Sensex:

Stocks that traded on the green on the Sensex include IndusInd Bank (up by 5.23%), Coal India (up by 1.56%), Yes Bank (1.53%), Hero Motocorp (1.51%), and Powergrid (1.29%). Stocks of Indusind Bank ironically were the most traded on the BSE in-spite of the bank suggesting of worsening asset quality. 4.16 lakh shares of IndusInd bank exchanged hands on Thursday.

IndusInd Bank in its quarterly results revealed of net profits dipping 62% to Rs 360 crores. NPAs rose by 1.21 percent. Here's more from IndusInd Bank results.

Analysts at HDFC Securities said that IndusInd Bank's Profit and Loss was significantly hit by exposure to the stressed IL&FS group. The analysts offered a buy on the stock. "The exposure to other potentially stressed groups is a monitorable. Maintain BUY with a TP of Rs 1,964 (3.5x Mar-21 ABV of Rs 561)," said analysts.