Investors lose over Rs 5 lakh crore as Sensex, Nifty see fag-end selling; more losses likely?

Sensex and Nifty saw heavy selling in the last hour of trade on Tuesday as investors booked profit in absence of positive triggers. Sensex slipped 873 pts to 81,186 and Nifty closed 194 points lower at 37,283. Market cap of the BSE-listed firms slipped to Rs 438.20 lakh crore in the current session against the market cap of Rs 443.67 lakh crore on Monday. This resulted in a loss of Rs 5.47 lakh crore investor wealth in the current session.  The indices have fallen for the third consecutive session today. 

Eternal, Maruti Suzuki, M&M, UltraTech Cement, PowerGrid, Nestle India, Bajaj Finance, Nestle India, Bajaj Finance and HUL were the top losers on Sensex, falling up to 4.10%. 

Tata Steel, Infosys and ITC shares were the only Sensex gainers rising up to 0.73%.     

Market breadth was negative with 1435 stocks ending higher against 2534 stocks falling on BSE. 135 shares were unchanged. 

Vinod Nair, Head of Research, Geojit Investments said, "With the lack of major positive triggers and prevailing uncertainty over U.S. fiscal stability, investors opted for profit-booking and adopted a cautious stance. Selling pressure was widespread as participants awaited more clarity on the India-U.S. trade agreement. Given the current premium valuations and delays in the trade deal, we foresee a phase of short-term consolidation, which may lead FIIs to scale back their positions in the domestic market."

BSE midcap index tanked 742 pts to 44,385, indicating weakness in the broader market. BSE small cap stock index too crashed 492 pts to 50,938 level. All 19 sectoral indices ended in the red on BSE. Auto stocks were the top losers with the BSE index slipping 1,150 pts to 52,730 and capital goods index declined 822 pts to 67,978. Banking stocks too slipped 635 pts on their BSE index to close at 62,349 mark. 

Ajit Mishra – SVP, Research, Religare Broking said, "The decline reflects rising caution among market participants in the absence of any major domestic triggers and amid global uncertainties. Intermediate volatility in the US markets and concerns over the potential impact of the US-China trade deal on foreign institutional inflows into emerging markets, including India, also weighed on sentiment. That said, we believe investors should not overreact to the recent dip and instead wait for clearer signals. While the breach of the 24,800 mark in Nifty has dampened near-term momentum, the short-term trend remains positive as long as the index holds above the 24,400 level decisively. In the meantime, we advise traders to avoid aggressive long positions and focus on sectors or themes that are showing relative strength."

Shrikant Chouhan, Head Equity Research, Kotak Securities looks bearish on the outlook of the market.

"In daily charts, Nifty has formed long bearish candle and on intraday charts it is holding correction continuation formation which is largely negative. We are of the view that, as long as market is trading below 24850/81700, the correction wave is likely to continue. On the downside, market could retest the level of 24550-24500/80800-80500. On the higher side above 24850/81700, the sentiment could change. Above the same, chances of hitting 25,000/82200 and 25,100/82500 would turn bright," said Chouhan.

Foreign institutional investors (FIIs) sold shares worth a net Rs 525.95 crore on Monday, according to data available with the BSE. DIIs also parted with shares worth Rs 237.93 crore. 

Previous session 

BSE Sensex fell 271.17 points or 0.33 per cent to settle at 82,059.42 and Nifty also ended in the red, losing 74.95 points or 0.30 per cent to close at 24,944.85.