Taking Stock: Market falls amid geopolitical tension; IT

Market Today

Bears tightened their grip on Dalal Street as the Indian benchmark indices shed more than 0.5 percent as investors remained concerned over India’s response to the terror attack and its consequences.

Market started the May series on a positive note with Nifty rising to day’s high of 24,365.45 in the initial hours but geopolitical tension between India-Pakistan weighed on investors sentiments, which dragged the Nifty to day’s low of 23,847.85. However, buying at lower levels especially in the IT stocks helped to regain some lost ground.

At close, the Sensex was down 588.90 points or 0.74 percent at 79,212.53, and the Nifty was down 207.35 points or 0.86 percent at 24,039.35.

For the week, BSE Sensex and Nifty added nearly 1 percent each.

Among sectors, except IT, all other indices ended in the red with media, metal, PSU, telecom, power, oil & gas, realty down 2-3 percent.

Broader indices underperformed the main indices with BSE midcap and smallcap indices falling 2.5 percent each.

Axis Bank, Adani Enterprises, Shriram Finance, Adani Ports, Trent were among biggest losers on the Nifty, while gainers included SBI Life Insurance, Infosys, TCS, Tech Mahindra, IndusInd Bank.

Overnight, US stocks closed higher, rallying for a third straight day with a solid boost from technology shares as investors parsed a mixed bag of corporate earnings and watched for signs of progress in the U.S.-China tariff stand-off.

European indices were trading firm, while Asian indices ended on a positive note on softening of the White House stance on China, despite no signal of detente.

In stock-specific action, Axis Bank shares were down 3.4 percent after reporting marginal fall in its Q4 standalone profit, Cyient shares fell 5.5 percent despite Q4 consolidated profit jumping 39%, SBI Cards and Payment Services shares declined more than 6 percent after Q4 profit shed 19%, and L&T Technology Services shares fell 5 percent amid weak Q4 earnings.

More than 50 stocks tested 52-week high on the BSE, including Navin Fluorine, Anupam Rasayan, UltraTech Cement, JK Cement, Dalmia Bharat, Coromandel International, UPL, among others.

Outlook for April 28

Rupak De, Senior Technical Analyst at LKP Securities

Nifty has slipped after a consolidation on the daily chart, indicating a rise in bearish sentiment. Additionally, the index has fallen below its 200-DMA, signaling a potential re-entry into a bearish trend. Investor sentiment remains weak, with a clear risk-off approach ahead of the weekend, amid rising tensions between India and Pakistan.

In the short term, sentiment is likely to continue driving the market trend, with the possibility of the index heading lower. Support on the lower end, is placed at 23800/23515.

Ajit Mishra – SVP, Research, Religare Broking

Markets began the first day of the new derivatives series on a weak note, primarily weighed down by escalating geopolitical tensions between India and Pakistan. After an initial uptick, the Nifty witnessed a sharp decline in the first half; however, a rebound in select heavyweight stocks helped pare some losses later in the session. Eventually, the index settled at 24,080, down by 0.69%. Across sectors, most traded in the red, with realty, pharma, and energy emerging as the top losers. The pressure was even more pronounced in the broader markets, as both the Nifty Midcap and Smallcap indices ended with losses exceeding two percent each.

The heightened geopolitical uncertainty has led investors to adopt a risk-off approach, triggering profit-booking after the recent sharp rally. Furthermore, the markets appeared slightly overstretched following the vertical rise, prompting traders to reduce exposure. On the benchmark front, sustaining above the 23,800 level is crucial for Nifty to retain its positive bias; failure to do so could lead to further profit-taking. Given the prevailing environment, we maintain a cautious stance and recommend a hedged approach for existing positions.

Disclaimer: Moneywealth research provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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