Sensex, Nifty edge down on profit-booking in banking, metal stocks

SBI was the top loser in the Sensex pack, shedding over 1 per cent. ITC, NTPC, Tech Mahindra, Tata Steel, Kotak Bank and M&M were among major losers.

Benchmark indices Sensex and Nifty retreated from over one-week highs to close lower on Wednesday due to profit booking in banking, IT and metal stocks amid weak global trends.

After a two-day rally, the 30-share BSE Sensex dropped by 90.99 points or 0.16 per cent to settle at 57,806.49 in volatile trade. As many as 19 of its constituents declined while 11 advanced.

The broader Nifty slipped by 19.65 points or 0.11 per cent to close at 17,213.60 with 31 of its stocks ending in the red.

SBI was the top loser in the Sensex pack, shedding over 1 per cent. ITC, NTPC, Tech Mahindra, Tata Steel, Kotak Bank and M&M were among major losers.

On the other hand, gains in Sun Pharma, IndusInd Bank, Dr Reddy's, Bajaj Finserv and Reliance Industries restricted Sensex losses.

Markets were choppy throughout the session ahead of the F&O expiry and a weak trend in global markets, experts said.

"Market traded flat today and closed in negative. In the past two trading days, the market witnessed positive momentum on the back of short covering ahead of the December F&O expiry.

"However, the market is expected to remain flat in the next two trading days ahead of the New Year holiday as many global markets will remain shut in the next few days," Arijit Malakar, Head Research (Retail) of Ashika Stock Broking said.

Experts said Omicron is a concern in the market as the Delhi government announced the Yellow alert and imposed restrictions amid a spike in virus cases.

The current concern for the market is that if other state governments follow the same then there will be again short term pause on the recovery of the domestic economy.

PVR shares declined by 1.98 per cent due to the ban by the Delhi government on cinema halls.

There are two divergent trends in the governments' and market's response to the Omicron variant, said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"Governments, globally, are responding with caution and imposing some restrictions.

"In India too Maharashtra and Delhi have imposed some restrictions in the context of rising cases.

"But the markets have responded to the Omicron variant assuming that this marks the last phase of the pandemic," he said.

Sectorally, BSE metal, power, utilities, bankex, basic materials and FMCG indices fell up to 1.01 per cent, while healthcare, auto, capital goods and telecom indices rose up to 1.71 per cent.

Broader midcap and smallcap indices rose up to 0.49 per cent.

Vinod Nair, Head of Research at Geojit Financial Services said, "Outweighing weak sentiments in most sectors, the pharma sector aided the domestic market to close on a flat note with a positive bias."

Emergency Use Authorization of Covid vaccines Corbevax and Covovax along with the clearance of anti-viral drug Molnupiravir for restricted use has boosted the appetite for most pharma stocks, Nair said.

FIIs were net buyers for the first time this month which helped the market.

Elsewhere in Asia, bourses in Shanghai, Hong Kong, Seoul and Tokyo ended with losses.

Meanwhile, international oil benchmark Brent crude rose 0.11 per cent to $78.76 per barrel.

"Rising crude is a macro headwind," said Vijayakumar.

Photograph: Danish Siddiqui/Reuters