Markets settle marginally lower on muted GDP growth projection

Mumbai, Jan 8: Equity benchmark indices Sensex and Nifty ended marginally lower in a volatile session on Wednesday, as investors stayed on the sidelines ahead of the earnings season amid lower economic growth projections.

Besides, a depreciating rupee and persistent foreign fund outflows also dented sentiments.

However, buying in bellwether stocks TCS and Reliance Industries managed to restrict a steep decline in markets, traders said.

The 30-share BSE benchmark Sensex fell 50.62 points or 0.06 per cent to settle at 78,148.49. During the day, it dropped 712.32 points or 0.91 per cent to 77,486.79.

The NSE Nifty skidded 18.95 points or 0.08 per cent to 23,688.95.

"Slowing economic growth projections and caution ahead of Q3 numbers added volatility in the market. However, the market witnessed a recovery from the day’s low owing to the accumulation of beaten-down blue-chip stocks and in expectation of government reforms in the upcoming budget to lift the tepid economy.

"The near-term sentiment is likely to be subdued due to the rise in US bond yield and fear of fewer rate cuts by the Fed," Vinod Nair, Head of Research, Geojit Financial Services, said.

From the 30-share blue-chip pack, Adani Ports, UltraTech Cement, Larsen & Toubro, Sun Pharma, HDFC Bank, ICICI Bank, NTPC and State Bank of India were the major laggards.

Tata Consultancy Services, Reliance Industries, ITC, Asian Paints, HCL Tech and Maruti were among the gainers.

"IT stocks to be in focus as Tata Consultancy Services is set to kick-start the Q3 earning season with its results tomorrow. While revenue for the IT giant is expected to remain impacted by furloughs, client-specific challenges are likely to normalize in 3Q. Its EBIT margin may improve, driven by talent development, training, and operational efficiency. Rising crude prices led to buying interest in upstream oil & gas companies.

"US markets will remain shut on Thursday on account of the National Day holiday. We expect Indian markets to remain range-bound with stock/sector-specific action on the back of upcoming Q3 results," Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services Ltd, said.

The BSE smallcap gauge declined by 1.12 per cent, and the midcap index went lower by 1.09 per cent.

Among BSE sectoral indices, consumer durables dropped 1.86 per cent, capital goods (1.34 per cent), services (1.26 per cent), power (1.17 per cent) and utilities (0.95 per cent).

In contrast, Energy, IT, oil & gas, realty, teck and BSE Focused IT were the gainers.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,491.46 crore on Tuesday, according to exchange data.