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BSE SENSEX Turbulence Due to Pre Budget and US Policy Changes

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Equity benchmarks Sensex and Nifty ended flat as cautious investors refrained from taking any positions in view of upcoming key events like F&O expiry, US Fed policy outcome and upcoming Union Budget.

The BSE Sensex ended marginally lower by 1.25 points and the NSE Nifty closed with a negligible loss of 0.4 point.

Heavyweights ICICI Bank and Tata Steel — both rising over 5 per cent — saved the day for the Sensex.

Also, mixed trading pattern in global shares as US-China trade talks kicked off earlier in the day made domestic investors even more cautious.

“While investors are grappling with a plethora of worries, from trade talks, the Fed meetings and the budget, markets continue to stay resilient. All eyes turn to the budget later this week,” according to analysts.

Investors will be interested in understanding the consumption boost that can be expected from budgetary relief packages and in particular, the plan for financing the measures as well as impact on borrowing costs, they said.

After opening over 200 points higher, the 30-share Sensex swung 359 points to finally settle 1.25 points lower at 35,591.25.

Similarly, the broader NSE Nifty ended 0.40 points down at 10,651.80.

Sectorally, metal and banking stocks rallied the most, while FMCG and realty stocks came under selling pressure.

Broader indices, however, outperformed benchmark indices with BSE Smallcap index jumping 0.78 per cent and BSE Midcap index rising 0.22 per cent.

On a net basis, foreign portfolio investors (FPIs) sold shares worth a net of Rs 354.36 crore Tuesday, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 81.27 crore, provisional data available with BSE showed.

Global investor sentiment was mixed as American and Chinese negotiators started two days of high-level talks aimed at settling a six-month trade war that has weakened both sides, shaken financial markets and clouded the outlook for the global economy.

Domestic investors turned cautious ahead of futures and options expiry of January series contracts and the upcoming interim budget, to be held on Friday.

Market is also awaiting the outcome of the US Federal Reserve’s meeting later in the day, they added.

Among the Sensex pack, ICICI Bank rallied 6.05 per cent ahead of its quarterly earning scheduled for release later in the day.

Shares of Tata Steel soared 5.14 per cent after S&P Global Ratings said the company’s plan to sell majority stake in its Southeast Asia business will help the company reduce debt by about 3 per cent without impacting its business position.

Axis Bank shares also jumped 4.56 per cent after the third largest private sector lender Axis Bank reported a 131 per cent surge in net income for the December quarter.

Other gainers include HCL Tech, Bajaj Finance, SBI, L&T, Coal India and Vedanta, gaining up to 2.82 per cent.

On the other hand, Bajaj Auto, Kotak Bank, HDFC, Yes Bank, Sun Pharma, Bharti Airtel, ITC, RIL, HDFC Bank, HUL, ONGC and Sun Pharma were the top losers, shedding up to 2.65 per cent.

Elsewhere in Asia, Hong Kong’s Hang Seng rose 0.40 per cent and Korea’s Kospi surged 1.05 per cent; while Shanghai Composite Index shed 0.07 per cent and Japan’s Nikkei slipped 0.52 per cent.

In the eurozone, Frankfurt’s DAX slipped 0.21 per cent, while Paris CAC 40 rose 0.53 per cent in late morning deals. While, London’s FTSE jumped 0.94 per cent.

SMEStreet Desk

SMEStreet is fast growing platform dedicated to entrepreneurs from small and medium sized businesses (SMEs). Committed to facilitate Knowledge & Networking for Business Growth, SMEStreet offers value added content which shows the actual voice of Indian MSMEs.

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