New Delhi: Indian benchmark equity indices ended lower for the second consecutive session on Wednesday as selling pressure across several sectors, elevated crude oil prices and persistent FII outflows weighed on market sentiment, offsetting optimism surrounding India-US trade negotiations.
The BSE Sensex declined 143.21 points, or 0.19%, to settle at 73,709.69, while the NSE Nifty 50 closed 77.60 points, or 0.34%, lower. Market volatility also increased, with the India VIX surging around 6%, indicating heightened uncertainty among investors.
The weakness was more pronounced in the broader market, with the Nifty Midcap 100 falling 1.58% and the Nifty Smallcap 100 declining 2.37%. Most sectoral indices on the National Stock Exchange ended in the red, with the Nifty Consumer Durables index emerging as the biggest laggard.
According to market analysts, investors booked profits across automobile, financial services, metals and real estate stocks amid concerns over inflation and pressure on corporate margins. Elevated crude oil prices and continued foreign investor selling further dampened sentiment.
Vinod Nair, Head of Research at Geojit Investments, said Indian equities surrendered their early gains as concerns over crude prices and persistent FII selling overshadowed optimism surrounding India-US trade negotiations.
He noted that resilient second-quarter earnings and strong domestic institutional investor flows continued to provide support to the market. However, weak market breadth and sustained foreign selling suggested that investors were likely to remain cautious in the near term.
Nair added that the market’s direction would depend on the breadth of corporate earnings, developments in trade negotiations and foreign fund flows. A sustained moderation in crude oil prices, global bond yields and currency volatility would also be crucial for market stability.
From a technical perspective, the Nifty slipped below its 20-day EMA, while the RSI remained in neutral territory and the MACD indicator stayed relatively flat.
Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities, said the technical indicators pointed towards cooling bullish momentum and fresh selling pressure following the recent rally.
He identified the 22,630-22,650 range as an immediate support zone for the Nifty, warning that a decisive break below this level could drag the index towards 22,500. On the upside, the 22,960-22,980 range is expected to act as an immediate resistance zone. A sustained move above this level could trigger a short-covering rally towards 23,130.
Meanwhile, the IPO of Jio Platforms attracted strong institutional demand on its first day of subscription. The issue was subscribed 2.22 times by 2.40 pm, with qualified institutional buyers QIBs subscribing 6.72 times their allotted portion. Non-institutional investors subscribed 0.86 times, while the retail individual investor segment was subscribed 0.57 times.
Elsewhere, Eternal shares declined 4.5% to Rs 305.65 ahead of the company’s second-quarter results. SML Mahindra hit its 10% lower circuit after reporting a 44.5% YoY decline in net profit to Rs 11.7 crore in the second quarter of the current financial year. Vishal Mega Mart shares also fell 6% after its profit margin contracted to 4.6%.
Market participants will continue to monitor corporate earnings, crude oil prices, foreign investment flows and developments in India-US trade negotiations for cues on the next direction of the domestic equity market.
