Investors adopted a cautious stance in today's trading session, resulting in a lackluster performance for the Sensex and Nifty. The indices remained range-bound throughout the day, ultimately closing in negative territory as concerns about consumer demand and the auto sector weighed on sentiment. This subdued performance comes as market participants await key economic data releases, including US and India CPI inflation figures, and the upcoming US Federal Reserve's interest rate decision.
Market performance:
The Sensex ended the day down 154 points, or 0.2%, at 81,554, while the Nifty shed 48 points to close at 24,629. Despite the overall negative trend, broader market indices showed resilience, with the BSE Midcap and Smallcap indices gaining 0.3% and 0.5%, respectively.
Sectoral performance:
- Consumer goods: The Nifty FMCG index was a significant drag on the market, declining over 2% due to a weak sales forecast from Godrej Consumer Products. The company's shares plummeted more than 9% after it anticipated mid-single-digit sales growth for the December quarter, citing subdued demand conditions. Tata Consumer and HUL also witnessed declines of 2-4%.
- Automobiles: The Nifty Auto index fell 0.8% following a year-on-year decline in passenger and commercial vehicle sales in November. Major automakers like Hyundai Motor, Tata Motors, Maruti Suzuki, and Mahindra & Mahindra all experienced declines.
- Pharmaceuticals and healthcare: These sectors also faced selling pressure, with the Nifty Pharma and Nifty Healthcare indices declining 0.5%. The exclusion of the US Biosecure Act from a key defense bill negatively impacted Indian CDMO and CRO players, leading to declines in shares of companies like Neuland Laboratories, Laurus Labs, and Divi's Laboratories.
- Financial services: This sector bucked the trend, extending gains from the previous week, supported by the Reserve Bank of India's decision to cut the cash reserve ratio (CRR) for banks. This move is expected to improve liquidity and support credit growth.
Gainers and losers:
Among the Nifty 50, L&T, Wipro, SBI Life, BPCL, and Tata Steel emerged as the top gainers, while Tata Consumer, HUL, Tata Motors, Axis Bank, and Nestle were the top losers.
Analysts suggest that the Nifty 50 is likely to remain range-bound between 24,000 and 25,000 in the near term, with support at 24,500 and resistance at 24,800-25,100.
The Indian stock market's subdued performance reflects a cautious approach by investors as they await key economic data and policy decisions. While concerns about consumer demand and auto sales have weighed on sentiment, positive developments in the financial sector and strong performance from broader market indices offer some optimism.
DISCLIMER: Prameya or Prameya News7 does not endorse the views or recommendations expressed by experts/brokerages in this article. These are solely their opinions. Readers are advised to consult with a qualified financial advisor before making any investment or trading choices.
