Diwali fireworks missing from Dalal Street as Sensex, Nifty fall

The S&P BSE Sensex was down 199.13 points to 79,743.05 at 10:07 am, while the NSE Nifty50 fell 126 points to 24,340.85.

In Short

• Sensex, Nifty open lower on sustained foreign institutional selling
• IT stocks face pressure as global market losses impact sentiment
• Nifty50 top gainers include Cipla, L&T, and ONGC

Benchmark stock market indices opened lower on Thursday because of sustained selling by foreign institutional investors and disappointing second-quarter results. Losses in Asian and US markets also weighed down sentiments on Dalal Street, significantly impacting information technology (IT) stocks.

The S&P BSE Sensex was down 199.13 points to 79,743.05 at 10:07 am, while the NSE Nifty50 fell 126 points to 24,340.85.

Most of the broader market indices also declined in early trade as volatility increased during the session.

The top five gainers on the Nifty50 were Cipla, L&T, ONGC, Hero MotoCorp and IndusInd Bank. On the other hand, the top losers were Tech Mahindra, HCLTech, TCS, Infosys and Wipro.

Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, “This Diwali it is unlikely to see fireworks in the market. India has been underperforming in October with Nifty down 5.7% when markets in US and Japan have delivered positive returns and China and Hong Kong have hugely outperformed.”

“India’s underperformance is driven by lofty valuations, relentless FII selling and concerns over slowing earnings growth. In the near-term, this scenario is unlikely to change, reversing the trend decisively, even though mild pullbacks are possible,” he added.

Vijayakumar noted that a significant trend in the market is the strong stock-specific action. “Better-than-expected results are responded with sharp moves up to 20% a day while worse-than-expected results are met with around 15% correction,” he noted.

“This trend of strongly rewarding good results and punishing poor results equally strongly is a reflection of the focus on stock-specific action rather than focus on the benchmark indices and market as a whole,” Vijayakumar explained.

He also noted that stocks and sectors which have delivered good results and good guidance are likely to remain resilient, advising investors to focus on such segments.