Dalal Street continued its downward slide on Monday, starting the week on a negative note with benchmark indices falling half a percent. Sensex tanked over 400 points, while Nifty lost 100 points.
As of 11:50 am, the S&P BSE Sensex was down by 388.85 points to 82,111.62, while the NSE Nifty50 lost 110.85 points to 25,039.00.
The market was dragged by a decline in IT stocks as they acted as major laggards. All major IT shares were trading in red.
The Nifty IT index faced broad-based selling pressure today, falling 1.42% to close at 37,159.25. Most major IT stocks ended in the red with significant declines across the board. Wipro led the fall with a sharp drop of 2.11%, followed by Tech Mahindra down 1.70% and HCL Technologies declining 1.67%.
Other major IT stocks also faced selling pressure with Infosys down 1.63%, Tata Consultancy Services falling 1.43%, LTIMindtree declining 1.27%, and MphasiS dropping 0.49%. Persistent Systems and Coforge also joined the decline, falling 0.36% and 0.26% respectively.
“So, due to the trade war uncertainty and also the earnings season started with lukewarm earnings of TCS, that has been creating some kind of pressure in the market as the trade war uncertainty remains persist. Investors and traders are trying to be on the sidelines. We need to see Nifty holding 25,000 levels. If the market sustains 25,000 levels, the trend can be positive. If the market fails to hold the 25,000 level of Nifty, we can see some perceived weakness,” said Director – Equity strategy, WealthMills Securities Pvt Ltd.
The top five gainers on BSE were Eternal up 2.32%, Titan up 0.80%, Sun Pharmaceutical up 0.63%, ITC up 0.53%, and Adani Ports up 0.41%.
On the losing side, Tech Mahindra crashed 1.70%, Infosys fell 1.69%, Bajaj Finance dropped 1.55%, Asian Paints declined 1.52%, and Tata Consultancy Services was down 1.50%.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said, “Nifty has been exhibiting weak trend weighed mainly by the weakness in the IT stocks. This weakness may persist particularly since the FIIs were big sellers in the cash market last Friday. It is important to note that banking and financials are outperforming even in this weak market. This trend may persist. The market has already discounted the NIM compression for banking stocks expected in Q1 results. Therefore, dips in banking stocks will provide opportunities to buy.”
“Market is expecting a US- India trade deal soon with a tariff rate of around 20% for India. If this happens the market will get a sentimental boost. Any disappointment on this front can drag the market further down,” he added.
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