Bulls take a breather after record run; Here’s what investors should do on Wednesday

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The Indian equity benchmarks ended marginally lower on Tuesday as investors booked profits.

Sensex closed 53 points or 0.1% lower at 52,276. Nifty 50 index slipped 12 points to settle at 15,740, dragged by banking, metal and financial services stocks.

Broader markets outperformed the benchmarks; BSE MidCap index closed 0.38% higher and the SmallCap index advanced 0.93%.

Among sectoral indices, Nifty PSU Bank, closing nearly 1.5% lower was the top laggard followed by Nifty Metal, Nifty Bank and Nifty Financial Services. On the other hand, Nifty IT, Nifty Pharma, Nifty FMCG, Nifty Media, Nifty Realty and Nifty Auto settled in the green.

Among the individual stocks, shares of Gautam Adani-led power producer – Adani Power – rallied a whopping 57% in the last four trading sessions.

Tata Motors, Tech Mahindra, Bharti Airtel, IOC and HCL Tech were the top Nifty gainers while Hindalco, Tata Steel, JSW Steel, Kotak Mahindra Bank and HDFC were the top losers.

Experts said that investors are awaiting key US inflation data which is due on Thursday for more indications and there could be some consolidation before we see Nifty climbing to 16,000

Ajit Mishra, VP – Research, Religare Broking:

Markets ended almost unchanged in a volatile trading session, in absence of any major trigger. The benchmark started on a flat note but selling pressure in the banking majors pushed the index lower in the first hour of the trade. As the day progressed, Nifty gradually inched higher, thanks to buying interest in IT, FMCG and healthcare majors and finally settled at 15,740 levels. The broader markets continued their outperformance and ended on a positive note in the range of 0.4-0.9%

In absence of any trigger, we may see further consolidation in the index thus it’s prudent to continue with a stock-specific trading approach. Needless to say, stability in the banking index is critical for further directional move in Nifty else the lackluster move would continue.

Vinod Nair, Head of Research at Geojit Financial Services

“Tracking cues from weak Asian peers, benchmark indices failed to sustain its momentum to stay at all-time highs, however, buoyancy in the broad market is maintained. Global markets are awaiting US inflation data, due on Thursday, to get cues over Fed policy outlook and global recovery, which will bring some volatility during the week.”