Index continues to Plunge; Banks, Auto, FMCG Drag, PSUs Gain
Yet another day of the slide, and another day of stress for traders on the Dalal Street on account of weak momentum in the western markets and a spike in the virus.
The benchmark indices extended their early losses and continued to decline throughout the session on February 18. Heavy selling in Banks, Financials, Auto and FMCG dragged the indices to fall drastically after hitting a record high in the first trading session. IT and Public Sector Banks added gains with the Nifty PSU index also hitting a fresh record high.
Sensex ended lower by 379 points at 51,324.69, Nifty-50 slipped to 15,118.95, down 89 points, or 0.59 per cent. Nifty Bank slipped over 320 points on selling pressure in all major stocks, HDFC Bank and Kotak Mahindra Bank tanked the most. The Nifty Energy index also marked a fresh record high as shares of GAIL and ONGC surged over six and eight per cent respectively.
BPCL and IOC added over four per cent each and Bank of Baroda gained over 13 per cent and made to the top gainers of Nifty. Shree Cements, Kotak Mahindra Bank and Apollo Hospital accounted under the head 'top losers' as their stocks witnessed heavy selling.
Weak momentum in the western markets and spike in the virus turned the market sentiment negative and the decline in the market is likely to continue in the next trading sessions too, market experts fear. However, the Public Sector Banks (PSB’s )will sustain the rally on hopes of privatization. Traders are taking new positions in the PSB’s on assumptions that the newly privatized banks might grow further.
S Ranganathan, Head of Research at LKP Securities, making a statement on PSU Banks said, “While Indices ended in the red on Thursday, the under ownership in PSU stocks was evident today also as several of them across sectors posted smart gains. The PSU bank index which rose 6% yesterday recorded huge gains for the second day in a row led by privatization hopes. In the broader market, Non-Life Insurers & Paper stocks saw keen interest among investors.”
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