Sensex retreats from record high; ends 71 pts lower as FMCG, energy stocks crack
Losses in FMCG, auto, energy and select banking stocks eroded the gains later with Sensex settling 70.99 points or 0.17 per cent down at 40,938.72.Updated: Dec 16, 2019 18:02 IST
Market benchmark Sensex declined by 71 points to close at 40,938.72 on Monday, dragged by losses in energy, FMCG and auto stocks amid weak macroeconomic numbers.
The 30-share BSE barometer had opened higher and hit a lifetime high of 41,185.03 in the opening session.
Losses in FMCG, auto, energy and select banking stocks eroded the gains later with Sensex settling 70.99 points or 0.17 per cent down at 40,938.72.
The broader NSE Nifty finished 32.75 points or 0.27 per cent lower at 12,053.95 as 37 of its components declined.
ITC was the top loser in the Sensex pack, shedding 1.97 per cent, followed by Tata Steel 1.80 per cent, HUL 1.57 per cent, Vedanta 1.44 per cent, Bharti Airtel 1.37 per cent and M&M 1.35 per cent.
On the other hand, IT stocks rallied due to weakness in the rupee. TCS rose by 2.70 per cent, Tech Mahindra 1.60 per cent, and HCL Tech by 1.57 per cent. Besides, HDFC gained 0.83 per cent and Kotak Bank by 0.73 per cent.
Vinod Nair, Head of Research at Geojit Financial Services said, “Inflationary pressure and static manufacturing activity impacted the sentiment while trade deal optimism buoyed global market. Global factors are likely to be more supportive in the near term and market anticipates a better economic growth in coming years which is giving support in every consolidation.” According to analysts investors are also keenly waiting for the upcoming GST council meet to get any cues on overcoming revenue shortfall.
Wholesale price-based inflation rose to 0.58 per cent in November, as against 0.16 per cent in October due to increase in prices of food articles.
For manufactured products, the wholesale inflation remained static (-)0.84 per cent during the month under review.
Traders said an agreement between the US and China over trade tariffs enthused global investors earlier in the day, but release of weak macro numbers dampened the market sentiment.
Hemang Kapasi, Portfolio Manager - Equity Investment Products, Sanctum Wealth Management said, “Indian markets cooled off today after three straight days of gains. Last week, the markets reacted to positive global events though macro data in India continued to be weak.” While the RBI governor has clarified that there is room for more policy easing, going forward, with high inflation and low industrial output there is limited room available for RBI to cut rates further in the short term, he added.
RBI Governor Shaktikanta Das on Monday said that in February, the market was surprised with the RBI’s call to hold rates. He wondered why is it surprised market participants now also with a pause call.
Sectorally, BSE telecom, metal, FMCG, consumer durables, auto and energy indices fell up to 1.59 per cent.
While BSE IT, teck, realty, utilities and healthcare indices ended in the green.
Broader BSE midcap and smallcap indices too fell up to 0.46 per cent.
Bourses in Shanghai, Hong Kong, Seoul and Tokyo ended on a mixed note, while those in Europe were trading significantly higher.
On the currency front, the rupee depreciated 18 paise against the US dollar to 71.01 (intra-day).
Brent futures, the global oil benchmark, was trading flat at USD 65.23 per barrel.