Indian stock markets BSE and NSE saw significant activity on Monday as benchmark indices Sensex and Nifty hit record high levels but ended lower due to profit-booking. Early in the trading session, both indices reached their all-time high levels before experiencing selling pressure later in the day.
Market Performance
The 30-share BSE Sensex crossed the 77,000-mark in early trade, reaching a record high of 77,079.04 points. However, it couldn’t sustain this level and ended 203.28 points (0.27%) lower at 76,490.08. Similarly, the NSE Nifty also hit a lifetime peak of 23,411.90 points during the day but settled down 30.95 points (0.13%) at 23,259.20, breaking a three-day rally.
Key Movers
Among the major losers on the Sensex were Tech Mahindra, Infosys, Wipro, Bajaj Finance, Mahindra & Mahindra, HDFC Bank, HCL Technologies, and Tata Consultancy Services. On the other hand, UltraTech Cement, Power Grid, Nestle, NTPC, Tata Steel, and Axis Bank emerged as the top gainers.
Market Sentiment
The market’s decline was attributed to profit-booking, especially in blue-chip IT stocks and HDFC Bank. Foreign Institutional Investors (FIIs) were net buyers, purchasing equities worth Rs 4,391.02 crore on Friday. However, Domestic Institutional Investors (DIIs) appeared to be booking profits after the market’s historic highs.
Vinod Nair, Head of Research at Geojit Financial Services, commented, “The Indian market currently lacks fresh catalysts following the formation of the new government at the centre. This suggests that some consolidation may occur in the near term. Institutional flows indicate a mixed trend, with FIIs gradually covering their shorts and DIIs booking profits.”
Global Market Influence
Asian markets showed mixed results, with Tokyo closing higher while Seoul ended lower. Markets in China and Hong Kong were closed for holidays. European markets were trading negatively, and US markets had also closed lower on Friday. Additionally, the global oil benchmark, Brent crude, saw a slight increase of 0.18% to USD 79.76 per barrel.
Previous Session Recap
On Friday, the BSE benchmark had ended at 76,693.36, up by 1,618.85 points (2.16%), while the Nifty closed with a gain of 468.75 points (2.05%) at 23,290.15.
Political Context
The market activity coincided with Narendra Modi being sworn in for a record-equalling third term as Prime Minister, leading a 72-member Union Council of Ministers. This political stability initially boosted market sentiment but lacked fresh catalysts to sustain the highs.
In conclusion, while Sensex and Nifty reached new heights, profit-booking and the absence of new market drivers led to a lower close. Investors are now looking for new catalysts to drive the market forward.
