Sensex, Nifty End Flat Amid Volatility

The markets failed to stand their early gains as profit booking took over the board and led the volatility index, India Vix, to surge three percent.

However, the benchmarks breached their psychological mark in the early trade and hit their respective day highs of 50,376 and 15,044.

After hitting the 50,000 level after 12 sessions, the BSE Sensex closed flat with a positive bias of 32.10 points at 49,765.94 and Nifty-50 closed at 14,894.90, up by 30.35 points. The concerning index India Vix, which hints at the expectation of volatility in near-term India settled at 23.30, up by 3.19 percent. 

The Financials, Metal, and Pharma stocks played defensives amid volatility caused by profit booking across the IT, Auto, and Banking sector ahead of the F&O expiry for April contracts. JSW Steel surged 10 percent and marked its fresh record high of Rs 728.90, Bajaj Twins advanced 4-7 percent in the intraday session backed by strong Q4 earnings.

"During the afternoon session, benchmarks managed to keep their head above water on the back of buying in Metals, Pharma and Chemicals stocks," said Narendra Solanki - Head of Fundamental Research at Anand Rathi Shares & Stock Brokers.

On the flipside, Hero Motors, Bajaj Auto, and Eicher Motors were the top drags for the markets today. Shares of Bajaj Auto tumbled nearly two percent in the day's trade ahead of its Q4 results. In the broader image, investors remained cautious ahead of the sales numbers of the sector for April as it will be impacted by the Covid surge.

"The auto sales for April 2021 is likely to be impacted by Covid-19-related restrictions/lockdowns across several states. On a sequential basis, the volumes may be lower across segments," said Emkay Global Financial Services.

Even after the Sensex breaching the psychological mark of 50,000 today backed by a favorable scenario in the global market and hopes of better vaccination drive, investors still need to be cautious as the resurgence of Covid has not affected the industrial activity yet, said experts.

"Even while enjoying the bull run investors have to be guarded against potential froth and bubbles. The localized lockdowns & curfews have not impacted industrial activity much but there is a downside risk to GDP growth & earnings estimates. The pain in segments like aviation, hotels, restaurants and retail trade will linger for some time", said VK Vijayakumar - Chief Investment Strategist at Geojit Financial Services.

The overall market breadth supported losses as 1505 shares declined, 1376 shares advanced, while 176 closed unchanged.