Sensex and Nifty 50 Decline Amid Profit Booking and Mixed Global Cues

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Indian Stock Market Sees Profit Booking, Snaps Four-Day Winning Streak

Team FS

28/Jun/2024

Key Points:

Sensex and Nifty 50 ended their four-day winning streak due to profit booking at higher levels.
Nifty 50 hit a fresh record high but closed 34 points lower; Sensex also reached a new high but ended with a 210-point loss.
Mid and small-cap segments bucked the trend with gains, boosting overall market capitalization by nearly ₹1 lakh crore.

On Friday, June 28, the Indian stock market experienced a bout of profit booking, causing benchmarks Sensex and Nifty 50 to end their four-day winning streak with losses. The Sensex declined by 210 points, or 0.27%, closing at 79,032.73, while the Nifty 50 fell by 34 points, or 0.14%, to close at 24,010.60. This decline came despite both indices hitting fresh all-time highs during the session, with the Nifty 50 reaching 24,174 and the Sensex peaking at 79,671.58.

Investors booked profits at higher levels amid mixed global cues, leading to the pullback. In the Nifty 50, 26 stocks ended in the green, while 24 stocks were in the red. The 30-share Sensex had 20 stocks closing in the red.

However, the mid and small-cap segments showed resilience, ending the day with gains. The BSE Midcap index rose by 0.41%, and the Smallcap index climbed by 0.56%. This upward movement in mid and small-cap stocks contributed to an increase in the overall market capitalization of firms listed on the BSE, which rose to nearly ₹439 lakh crore from nearly ₹438 lakh crore in the previous session, making investors richer by about ₹1 lakh crore in just one session.

Several stocks hit fresh 52-week highs, including Bharti Airtel, Reliance Industries, JSW Steel, and Tech Mahindra. Shares of Reliance Industries and Bharti Airtel were particularly notable, as they increased some of their tariff plans, a move expected to boost their revenue and profitability. While Reliance ended as one of the top gainers in the Nifty 50 index, Bharti Airtel closed among the top losers due to profit booking.

After experiencing a 0.3% decline in May due to election-related jitters, the Nifty 50 surged nearly 7% in June, driven by renewed buying from foreign institutional investors (FIIs). A healthy economic growth outlook, anticipated above-normal monsoon, and strong domestic retail investor inflows have supported the market. However, the market seems to have discounted these factors and is searching for fresh triggers to start the next leg of the rally.

Despite the market's mixed performance, the mid and small-cap segments have seen strong buying interest from retail investors, driving up their valuations. The mid and small-cap spaces have been particularly attractive to retail investors, who have been looking for opportunities in these segments due to their potential for higher returns.

Top Nifty 50 gainers included Dr Reddy's Labs (up 2.63%), ONGC (up 2.56%), and Reliance Industries (up 2.19%). Conversely, the top Nifty 50 losers were Axis Bank (down 1.95%), ICICI Bank (down 1.86%), and Bharti Airtel (down 1.82%).

In terms of sectoral performance, the Nifty Bank index ended with a loss of 0.89%, while the Financial Services index fell 0.87%. The Nifty Private Bank index suffered a loss of 1.24%, but the PSU Bank index ended with a healthy gain of 0.88%. Meanwhile, the Nifty Oil & Gas (up 1.68%), Pharma (up 1.11%), and Healthcare (up 1.10%) sectors ended with significant gains.

These sectoral performances highlight the market's selective strength amid broader uncertainties. Investors are looking forward to the upcoming PCE inflation data, which could influence future Federal Reserve policy decisions and potentially impact global market trends.

In summary, the Indian stock market's benchmarks, Sensex and Nifty 50, experienced losses on Friday due to profit booking at higher levels amid mixed global cues. Despite hitting fresh all-time highs, both indices succumbed to selling pressure. However, mid and small-cap segments continued to attract investor interest, leading to gains and an increase in overall market capitalization. The market is now seeking new triggers to sustain its upward momentum as it navigates through economic and political developments.

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Indian Stock Market Sees Profit Booking, Snaps Four-Day Winning Streak

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