The domestic stock market closed marginally on Tuesday after hitting an all-time high with the BSE Sensex crossing the historic 75,000 mark and the Nifty reaching a new high. Experts said the intraday surge in the index was due to continued optimism about good revenue growth, a strong economy and gross inflows, but the decline towards the close was due to the profit book.
In a brief pause in its record rally, the 30-share BSE Sensex closed 58.80 points, or 0.08 per cent, lower at 74,683.70. It rose 381.78 points (0.51%) during the day, reaching an all-time high of 75,124.28.
The NSE Nifty fell 23.55 points or 0.10 per cent to 22,642.75. On this day, the index rose 102.1 points (0.45%) and hit a record high of 22,768.40.
Among the 30 stocks in Sensex, Titan, Reliance Industries, Asian Paints, Tech Mahindra, IndusInd Bank, UltraTech Cement, Wipro and ITC were the major laggards. ICICI Bank, Infosys, Bajaj Finserv, Tata Steel, Axis Bank, Bajaj Finance, Nestle and Mahindra & Mahindra were the major gainers.
In Asian markets, Tokyo, Shanghai and Hong Kong remained in positive territory, while Seoul ended in decline. European markets traded mostly lower. Wall Street ended Monday on a mixed note.
Foreign institutional investors (FIIs) sold shares worth Rs 684.68 crore on Monday, according to exchange data. Global oil benchmark Brent crude rose 0.18% to $90.54 a barrel.
The BSE benchmark rose 494.28 points or 0.67 per cent to a new close of 74,742.50 on Monday. The NSE Nifty rose 152.60 points or 0.68 per cent to 22,666.30.
Why has the market shifted from all-time highs to the red territory today?
“Indian markets have touched record highs driven by good revenue growth, strong economy and continued optimism about total flows reaching $50 billion,” said Rakesh Parekh, MD and Joint Head (Portfolio Management Services), JM Financial. FY24 (of which approximately $2 billion per month was a domestic systematic investment plan).”
He said this momentum is expected to continue with even more vigor throughout the remainder of 2024, especially after the expected return of the current government in June.
Vinod Nair, Head (Research), Geojit Financial Services, said, “Indian markets have touched fresh intraday highs ahead of the profit book at higher levels in anticipation of key US inflation data tomorrow, which will play a significant role in the decision to cut interest rates in the future.” He said. By the U.S. Federal Reserve.”
He added that recent better-than-expected U.S. employment and manufacturing data are raising concerns, which suggests expectations of a rate cut this year may change.
Prashanth Tapse, Senior Vice President (Research), Mehta Equities, said: “Sensex and Nifty hit new lifetime highs on the auspicious day of Gudi Padwa, but the market ended flat on negative bias towards selective profit taking, wiping out all gains. Fundamentals remain strong, but expanding valuations will allow investors to record profits on a regular basis.”
He added that investors will still be mindful of the U.S. Federal Reserve's inability to cut interest rates amid rising crude oil prices and stubborn inflation. This may add to uncertainty in the future. For Nifty, the immediate hurdle lies at 22,771 point, while the index is finding support at 22,255 level.
“Nifty opened higher but struggled to withstand selling pressure at higher levels,” said Rupak De, senior technical analyst at LKP Securities. On the hourly chart, RSI (14) indicates a bearish divergence, indicating that the price momentum is likely to shift in a downward direction. Immediate support is observed at 22,600. A clear decline below this level could take the index down to 22,400. Conversely, resistance is evident on the higher side at 22,770.”