Stock market today: Frontline indices, the Sensex and the Nifty 50, ended in the negative territory on Tuesday, 5 May, largely due to profit booking in select banking and financial heavyweights.
The 30-share pack closed 252 points, or 0.33%, lower at 77,017.79, while the NSE barometer ended at 24,032.80, down 87 points, or 0.36%.
However, the mid and small-cap indices ended higher, outperforming the benchmarks. The BSE 150 Midcap closed 0.15% higher, while the BSE 250 Smallcap index ended with a gain of 0.20%.
Thanks to the gains in the broader markets, the overall market capitalisation of BSE-listed firms remained stable at ₹467 lakh crore.
Why did the Sensex, Nifty 50 fall today?
The fall in the benchmark indices can be attributed to the selling in banking and financial stocks.
In terms of index contribution, ICICI Bank, HDFC Bank, Axis Bank and SBI featured among the top drags on the benchmarks.
The Nifty Bank index fell 0.60%, while Private Bank and PSU Bank indices declined 0.67% and 0.20%, respectively.
However, weak global cues, elevated crude oil prices amid persisting uncertainties over possible talks between the US and Iran, the rupee’s fall to fresh record lows, and foreign capital outflows remain key headwinds for the domestic market.
“Domestic equities witnessed a volatile session, closing lower as post-election optimism faded and sentiment re-aligned with global weakness amid rising geopolitical tensions,” Vinod Nair, Head of Research, Geojit Investments, noted.
“Elevated crude prices continued to pressure the rupee, which slipped to record lows. Despite these headwinds, the ongoing earnings season, with results slightly ahead of expectations, provided some support and triggered selective bottom-fishing,” Nair added.
As many as 34 stocks ended in the red in the Nifty 50 index; ICICI Bank, Jio Financial Services, Coal India, Tech Mahindra, and Axis Bank ended as the top losers in the index.
On the technical front, Rupak De, Senior Technical Analyst at LKP Securities, pointed out that on the daily chart, the Nifty has sustained below the 50EMA for eight consecutive sessions, keeping the bearish trend intact. The RSI is in a bearish crossover, indicating weak momentum.
However, De highlighted that there is a possibility of a meaningful recovery from current levels.
“On the lower timeframe, the index has started forming higher lows, which might be an early sign of a potential reversal. In the short term, the index may move higher with a potential upside towards 24,285–24,350. On the downside, support is placed at 23,880, below which weakness could intensify,” said De.
Sudeep Shah, the head of technical and derivatives research at SBI Securities, said the 23,900–23,880 zone may act as immediate support for the index, and a decisive break below 23,880 could trigger further weakness, dragging the index towards the next crucial support at 23,750.
On the upside, Shah said the 24,180–24,200 zone remains a key hurdle.
“A sustained move above 24,200 may pave the way for a sharp upside rally towards 24,350, followed by 24,500 in the short term,” said Shah.
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