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The Indian stock market experienced a significant downturn on November 12, with the benchmark indices Nifty and Sensex falling for the fourth consecutive day. The decline was attributed to a sharp drop in auto and FMCG stocks, dampening investor sentiment. This downturn occurred ahead of the release of the October Consumer Price Index, scheduled for later that day.
The market's cautious stance was amplified by heavy foreign investor outflows, high valuations, and lackluster Q2 earnings reports. At the close of trading, the Sensex had fallen 820.97 points, representing a 1.03 percent decline, to close at 78,675.18. Meanwhile, the Nifty shed 257.80 points, a 1.07 percent drop, ending the day at 23,883.50. Of the listed companies, 1155 saw gains, 2641 experienced losses, and 93 remained unchanged.
Mid- and small-cap indices followed the downward trend, falling by 1 percent and 1.3 percent respectively. These broader markets, which have surged nearly 25 percent year-to-date compared to the Nifty's 13 percent rise, displayed signs of fatigue. The market volatility index, India VIX, climbed over a percent, settling just above 14, reflecting the heightened uncertainty in the market.
Auto stocks bore the brunt of the decline, with the Nifty Auto index plummeting nearly 2 percent. This was driven by losses in prominent companies like Tata Motors, Mahindra & Mahindra, Maruti Suzuki, and Bajaj Auto. FMCG stocks mirrored this trend, with Britannia Industries, Nestle, and Hindustan Unilever weighing heavily on the index. Other sectors also saw significant declines, including Nifty Bank, Energy, Infra, Metal, and PSU Bank, each falling over 1 percent.
Hyundai Motors, the most recent major entrant into the stock market, extended its morning losses after a disappointing Q2 performance. Its consolidated net profit for the quarter ending September 30, 2024, fell 16 percent to Rs 1,375 crore, marking its first earnings report since listing. This decline was attributed to lower domestic sales and exports. The 'Creta' SUV manufacturer had reported a consolidated net profit of Rs 1,628 crore in the same period the previous year. The auto major disclosed that its Q2FY25 consolidated revenue from operations decreased by 7.5 percent to Rs 17,260 crore, compared to Rs 18,660 crore in Q2FY24.
Another major stock that tumbled was Britannia Industries. Its shares plunged almost 8 percent following the release of its earnings report for the quarter ending September, which fell short of expectations. The FMCG player reported a consolidated net profit of Rs 531.5 crore, a 9.4 percent decrease from Rs 586.5 crore in the same period the previous year. The company's exchange filing revealed that revenue from operations stood at Rs 4,667.6 crore in the reported quarter, a 5 percent increase compared to Rs 4,432.88 crore in the corresponding period of the preceding financial year.
On a positive note, realty stocks bucked the overall trend, albeit marginally, gaining 0.2 percent. They had given up nearly all their gains from the morning when the index had been up by 2 percent. Stocks like DLF, Macrotech Developers, and Godrej Properties supported the index's rise. Nifty Realty has risen 26 percent this year, significantly outperforming the Nifty's 13 percent gain. The Nifty IT index also edged up by 0.3 percent.
Mandar Bhojane of Choice Broking observed that the Nifty index remained confined within a narrow range between 24,000 and 24,350, with potential for an upward move if momentum builds, targeting the 24,500-24,550 zone. Bank Nifty has also been range-bound between 51,200 and 52,400, facing resistance at higher levels and buying support below.
The biggest losers on the Nifty were Britannia Industries, HDFC Bank, NTPC, Asian Paints, and Bharat Electronics. On the other hand, the top gainers included Trent, HCL Technologies, Sun Pharma, Infosys, and Reliance Industries.
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Source: Nifty slips, Sensex sheds 800 points as all sectors slide; India VIX up 3%