Sensex, Nifty Snap Two-Week Winning Streak As Metal Stocks Weigh
- Oldest First
India’s stock benchmarks snapped a two-week winning streak as metal, realty and banking stocks dragged. Hawkish comments from the minutes of the U.S. Federal reserve hinting at the possibility of tapering by this year sapped sentiment.
The S&P BSE Sensex fell 0.54% to 55,329.32. The NSE Nifty 50 declined 0.71% to 16,450.50. Tata Steel Ltd. contributed the most to the index decline and had the largest move, decreasing 8.3 percent.
The broader indices underperformed their larger peers with both the S&P BSE MidCap and the S&P BSE SmallCap shedding 2%. Barring S&P BSE FMCG, all the other 18 sectoral indices compiled by the BSE Ltd. declined, with S&P BSE Metal slipping 7%.
The market breadth was skewed in favour of bears. About 752 stocks advanced, 2,447 declined and 132 remained unchanged.
"Indication of winding down monthly asset purchase programme in FOMC meeting minutes made investors jittery, which weighed domestic equities. However, considering improved visibility of sustained earnings growth in subsequent quarters, a meaningful correction in quality midcap names should be bought. Rise in delta variant of Coronavirus in various parts of the world and increasing concern about sustainability of ongoing economic recovery globally led heavy profit booking in metal stocks. We believe that underlying strength of domestic market remains intact. In our view, progress of monsoon, festive demand and COVID-19 positivity rates will be in focus in coming days. We note higher government’s capex and revival in industrials’ capex should aid economic recovery. Investors must focus on quality stocks with robust earnings visibility and margins of safety", wrote Binod Modi, Head Strategy at Reliance Securities in a note.
Ashoka Buildcon Wins Rs 186 Crore Order From Rewa Ultra Mega Solar
Ashoka Buildcon Ltd. received Notification of Award from Rewa Ultra Mega Solar Ltd. The order is related to development of transmission system for 1500 MW solar parks in Madhya Pradesh.
In an exchange release, Ashoka Buildcon said that the accepted contract price of the project was Rs 186.11 crore.
Of the 20 analysts tracking the company, 19 maintained ‘buy’ and 1 maintained ‘sell’ recommendation with 9 of the analysts revising the price targets higher over the past month. The overall consensus price of analysts tracked by Bloomberg implied an upside of 53%.
BofA Sees Indian Stocks Correcting
Fed taper talk and rise in U.S. yields and the dollar are among factors that could act as negative triggers, according to analyst notes of BofA Securities India Ltd.
Locally, peak valuations, consensus EPS estimate cuts and recent muted IPO gains negatively impacting retail investor sentiment could be triggers.
Nifty target of 15,000 implies 9% potential downside from current levels
Analysis of past market rallies suggests the current rally could have limited further runway
Prefers large-cap stocks near term on cautious view
Turns overweight on defensives while cutting materials to underweight
Maintains overweight on industrials and financials
Nestle India Shares Hit 52-Week High
Shares of Nestle India Ltd. rose 3.11% to hit 52-week high of Rs 19,499.40 apiece. Trading volume was 99,523 shares, double the 20-day average of 43,301 shares for this time of the day.
Analysts have 18 'buy', 17 'hold' and 6 'sell' recommendations on the stock with 16 analysts revising price targets higher over the past month.
The relative strength index on the stock was above 70, suggesting that it may be overbought. This is the fifth consecutive session in which the stock has gained.
Britannia Shares Climb To 10-Month High
Shares of Britannia Industries Ltd. added 2.91%, to Rs 3,829 apiece, higher than any close since October 5, 2020.
Trading volume was 5,77,111 shares, 70% above the 20-day average of 3,38,653 shares for this time of the day.
The relative strength index on the stock was at 76, indicating it may be overbought.
Analysts have 28 'buy', 10 'hold' and 5 'sell' recommendations on the stock with 18 analysts revising their price targets higher over the past month.
The overall consensus price target of analysts tracked by Bloomberg implied an upside of 4.8% .