With pharma major Sun Pharma’s maximum blow to the market, the benchmark BSE Sensex tanked heavily and weighed down by some late-session selling pressure by the watchful investors. As a result, the Sensex plunged 238 points, thereby closing the index lower at 28,182.14 on Tuesday.
Besides Sun Pharma, others heavyweights like Vedanta, lupin, ONGC, Tata Steel and Cipla also ran up losses at the end of the trade. “Investor focus was on the monsoon session of Parliament and heavyweight earnings as the market traded sideways and finally closed in the negative territory,” said Alex Mathews, Head Research, Geojit BNP Paribas Financial Services.
Cautious investors steered clear of healthcare, realty, refinery, banking and FMCG counters, but Sun Pharma dealt the maximum jolt, plunging as much as 15 per cent, its biggest daily fall, after the company warned that its earnings numbers would be tepid at best.
But the silver lining was Infosys whose stock zoomed 11 per cent after the company reported a nearly 5 per cent year-on-year (y-o-y) increase in consolidated net profit at Rs 3,030 crore for the June quarter.
Its bullish revenue guidance lifted other IT stocks too. The Sensex started the day on a weaker note at 28,391.82, but recovered immediately to 28,518.06 on the back of solid foreign capital inflows coupled with Infosys’ positive show.
Intra-day, it fell to 28,138.30 before settling at 28,182.14, down 237.98 points, or 0.84 per cent, largely due to fag-end profit-booking by participants.
The 50-share Nifty dropped 74 points, or 0.86 per cent, to close at 8,529.45 after trading between 8,517.90 and 8,646.75. Of the 30 Sensex stocks, 23 ended lower while only seven notched up gains.
“The initial Q1 FY16 results are a mixed bag, providing no clear picture of the earnings outlook. The expectation regarding results is low,” said Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services.
In spite of the cloudy sentiment, Bharti Airtel, Wipro Hero MotoCorp and Bajaj Auto registered gains in the market too.
In terms of BSE sectoral play, healthcare fell 5.93 per cent, along with realty, oil and gas and FMCG. However, IT ended in the positive territory. The broader markets couldn’t escape the selling pressure as the BSE small-cap and mid-cap indices fell up to 1.59 per cent.
Going ahead, investors are waiting for the outcome of the monsoon session of Parliament, which is going to decide the fate of key legislative reforms such as GST and land Bills.
According to provisional data, foreign portfolio investors (FPIs) net bought shares worth Rs714.40 crore on Monday. The market breadth turned negative as 1,883 stocks finished lower, 946 closed higher while 101 ruled steady. The total turnover rose to Rs3,203.58 crore, from Rs2,775.95 crore on Monday.
European stocks were trading mixed on Tuesday while Asian markets signed off higher. US stocks closed mildly higher on Monday with the Nasdaq hitting another record as earnings reports came in.