The Indian stock market ended Wednesday’s session with mixed performance, as the frontline indices struggled amidst global concerns and local market dynamics.
The 30-share BSE Sensex declined 312.53 points or 0.40 per cent to settle at 78,271.28. During the day, it went lower by 367.56 points or 0.46 per cent to 78,216.25. The NSE Nifty dropped 42.95 points or 0.18 per cent to 23,696.30.
The main factors influencing the market’s performance were concerns related to the ongoing U.S.-China trade war, which continued to weigh on investor sentiment.
Additionally, traders shifted their attention to the upcoming Reserve Bank of India (RBI) monetary policy meeting, where expectations are building for a potential rate cut under the new central bank governor.
As a result, large-cap stocks continued to face pressure, while midcap and smallcap stocks performed relatively better, aided by strong buying interest.
A notable aspect of the day’s trading was the performance of state-owned and energy companies, which saw significant gains. Shares of companies like ONGC, BPCL, IOC, HPCL, and IGL surged by 2 pc to 3 pc.
Goldman Sachs raised its rating for BPCL and HPCL to 'Buy' and upgraded IOC to 'Neutral,' citing improved earnings outlooks for these companies.
Macquarie also upgraded its rating for ONGC to 'Outperform,' raising its target price from ₹250 to ₹310 per share, following improved market sentiment.
In the energy sector, the focus was particularly on IGL, which had not raised CNG prices in Delhi for over three months, while its competitors had already raised prices by 2-4 pc.
Following the Delhi elections, IGL is expected to increase CNG prices by 4 pc, further boosting its outlook. Analysts are monitoring these movements closely, considering the impact on both the company’s performance and the broader market trends.
Market participants have also been weighing the improved domestic outlook, which has been bolstered by a positive Union Budget, against the backdrop of ongoing global uncertainties.
Vinod Nair, Head of Research at Geojit Financial Services, mentioned that while the domestic market has benefited from favourable economic indicators, global uncertainties, particularly stemming from trade tensions, remain a concern.
The falling U.S. bond yields and lower crude oil prices have helped market sentiment, but the depreciation of the Indian rupee could dampen these gains. Rate-sensitive sectors are under close scrutiny as investors anticipate potential policy changes from the RBI.
From a technical perspective, analysts suggest that the Nifty remains in a somewhat sideways movement, hovering between 23,700 and 23,800. However, the overall outlook for the index remains bullish, with the Nifty staying above key moving averages, suggesting continued positive momentum in the short term.
Rupak De, Senior Technical Analyst at LKP Securities, pointed out that while the index could face resistance at 23,800, it has the potential to move towards 24,050 in the near future.
Support is seen at the 23,500 level, where significant put writing has been observed, adding further confidence to the bullish outlook.
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