Last hour recovery helps Sensex end just 20 pts lower, Nifty above 10,750; pharma sees big gains
A solid fight back by the bulls in the last hour of trade ensured that benchmark indices ended their day and week off the low points. The Sensex managed to end flat, while the Nifty closed above 10,750-mark.
The day was largely marked weak moves on D-Street, dragged by factors such as weak global cues, surge in crude prices as well as bond yields. A weaker rupee also dented sentiment for the market.
Among sectors too, all major sectoral indices were trading in the red. But defensive segments such as IT and pharmaceuticals saw a strong surge. The Nifty Pharma index gained over 4 percent. PSU banks too gained in the second half, up over 1 percent, while IT had a good day of trade.
In case of broader markets, midcaps went through a good trading session, outperforming the benchmarks. The Nifty Midcap index was up over half a percent.
The Sensex ended down 19.41 points at 35443.67, while the Nifty was down or 0.01% at 10767.70. The market breadth was positive as 1,468 shares advanced against a decline of 1,153 shares, while 158 shares are unchanged.
Sun Pharmaceuticals and Dr Reddy’s Laboratories were the top gainers on both indices, while Power Grid, HDFC and Hindalco had lost the most.
“The market found strong support at lower levels, as the Nifty index staged a smart recovery post noon from intra-day lows of 10,709 and ended the session on a flat note. Broader markets continued their outperformance, with BSE Smallcap & Midcap gaining 0.6% & 0.4% respectively. The sectoral indices exhibited a mixed trend,” Jayant Manglik, President, Religare Broking, said in a statement.
Stocks in the news
Shares of Tata Motors gained 2 percent as investors bet on the firms’ fundraising plans. The stock had gained even on the back of group global wholesales seeing a 24 percent jump in May.
Dr Reddy’s Laboratories gained 5 percent, amid a rally in pharmaceutical names. A report by Press Trust of India stating the roll out of multiple scerlosis drug in this fiscal may have also boosted sentiment. The report said that the firm is expected to launch over 15 products in the US market in 2018-19, according to a top company official.
Sun Pharmaceutical was the top gainer among frontline names, with gains of 8 percent, as the US Food and Drug Administration issued a voluntary action indicated (VAI) status to its Halol unit. The status implies that a reinspection of the unit was unlikely by the US drug regulator.
Aurobindo Pharma was in the news for similar reasons after the US drug regulator issued the VAI status. The stock was up by over 4 percent.
Cipla rose nearly 3 percent as it partnered with Eli Lilly for the marketing and distribution of Lilly’s BASAGLAR, a diabetes drug, in India.
Investors in Vakrangee saw some cheer after days of fall. The stock was locked in 5 percent upper circuit ahead of its Board Meeting on June 14, 2018.
Meanwhile, shares of Kwality touched 52-week low of Rs 30.10, locked at 5 percent lower circuit, on Friday on a report that the stock has been included in BSE’s surveillance list.
Manpasand Beverages too saw some uptick after days of underperformance. The stock ended 3 percent higher.
Asian markets ended the day lower as sentiment among investors turned cautious after the recent rally. The Nikkei 225 declined 0.56 percent, or 128.76 points, to close at 22,694.50.
Meanwhile, European markets begun the day lower as investors were jittery ahead of G-7 meet in Canada during the weekend. Stoxx 600 was 0.6 percent off with all sectors trading in the red.
“After the recent smart upmove, we expect the markets to consolidate in the coming sessions. The near term market trend will be dictated by domestic macro data like IIP for the month of April and CPI & WPI inflation for May, movement of crude oil prices & currency (INR vs USD) and progress of monsoon. Global developments, especially in US & China, will also be closely monitored. Investors should consider any correction as an opportunity to accumulate fundamentally sound stocks. However, considering high volatility in the indices, traders should keep their positions hedged,” Manglik further added.