 | « Back to article | Print this article |
Markets snap 10-day winning streak; Sensex loses 40 points
Markets snapped its 10-day winning streak as investors booked profits at higher levels in banking, oil & gas and capital goods stocks. Sentiment came under pressure on Tuesday after HSBC Purchasing Managers' Index data showed that economy's largest sector -- services -- continued to contract in the month of March.
Both Sensex and Nifty slipped in morning deals after hitting ninth consecutive fresh intra-day highs, and extended losses in noon deals.
However, a recovery from lower levels in the last hour of trade led by buying in banking, metals and realty stocks, capped losses.
The 30-share BSE Sensex closed 42 points lower at 22,509 levels and NSE Nifty slipped over 16 points at 6,736 levels.
“Nifty has been witnessing a formation of "Hanging Man" for past three trading sessions which is considered as a bearish reversal pattern.
However, we expect further downfall in the markets only once Nifty breaches the support of 6660 in near term.
Till then we continue to remain bullish and expect buy to emerge on every dips,” says Hadrien Mendonca, Technical Analyst at IIFL.
During the day India VIX, a key measure of market's expectation of volatility over the near term, tested its 4-month high levels, only to settle 1.37% lower at 25.14 as market recovered in last 15 minutes.
Chandan Taparia, Derivative analyst at Anand Rathi says, “Rising VIX indicates that now risk of taking fresh positions will rise as we head towards elections and volatility will increase based on opinion poll and election results”.
“When volatility rises sharply then investor and traders shift to defensive stocks from fmcg, pharma and technology stocks. So being the higher vol we may see some support base buying coming in all these sectors,”
Service sector failed to pickup in March as contraction continued for the ninth straight month.
The PMI services stood at a three-month low of 47.5 points in March compared to 48.8 points in February -- indicating a contraction.
In February, the index had inched up from 47.7 points in the previous month.
A PMI reading below 50 marks a fall, whereas one above that indicates growth.
Top PHOTO features of the week
