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Jittery investors stay away

The 30-share Sensex ends 97 points lower as risk-off participants avoid taking fresh positions
On the BSE, the Sensex opened lower at 33438.31 and remained range bound till noon, following which it hit a day’s high of 33933.66 — a gain of over 328 points.
On the BSE, the Sensex opened lower at 33438.31 and remained range bound till noon, following which it hit a day’s high of 33933.66 — a gain of over 328 points.
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Our Special Correspondent   |   Mumbai   |   Published 18.06.20, 12:47 AM

Stocks on Wednesday ended lower after a volatile session as border tensions with China only added to the worries of investors, who are spooked by the rising Covid-19 cases in the country and its economic impact.

The 30-share Sensex ended 97 points lower as risk-off participants avoided taking fresh positions. Market experts expect volatility to continue amid disappointing corporate results. Investors would track global cues, India-China border issues and the telecom AGR hearing on Thursday.

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The BSE Sensex opened lower at 33438.31 and remained range bound till noon, following which it hit a day’s high of 33933.66 — a gain of over 328 points. However, the gauge could not sustain the gains and ended lower at 33507.92 — a drop of 97.30 points or 0.29 per cent. Between the high and low points, the index moved more than 600 points. The NSE Nifty settled 32.85 points, or 0.33 per cent, down at 9881.15. It touched a high of 10003.60 and a low of 9833.80 in the session.

Rahul Gupta, head of research — currency at Emkay Global Financial Services, said: “The geopolitical tensions between India and China have brought back the risk-off mood. We don’t expect the dispute to escalate ... but till then the market will remain skittish across markets. Any escalation will lead to a sharp bull-run in the spot rupee-dollar position.”

Until 76 doesn’t break in USDINR spot, it will continue to remain afloat. The immediate support lies around 75.75, and resistance around 76.50.”

Meanwhile, the rupee pared early losses to settle 4 paise higher at 76.16 against the US dollar on Wednesday amid a weakening greenback.

The currency opened weak at 76.21, but recouped losses and closed at 76.16 against US dollar, higher by 4 paise over its last close.

“The border skirmish with China has given yet another reason for the investor to stay on the sidelines. Already there are concerns with regard to the economic growth as Covid-19 cases are only increasing which could only delay the economic recovery’’, an analyst with a foreign brokerage said.

This came after reports that as many as 20 Indian Army personnel were killed in a clash with Chinese troops in Ladakh on Monday night and that there were around 35 casualties on the Chinese side.

Kotak Bank was the top laggard in the Sensex pack, shedding over 2 per cent, followed by ITC, PowerGrid, M&M, HDFC, Asian Paints and NTPC. However, Maruti rallied over 4 per cent. Bharti Airtel, Axis Bank, IndusInd Bank and Bajaj Finance were also among the gainers.

``Mixed global cues along with rising border tensions between India and China kept investors cautious. Further spike in COVID-19 cases and unabated foreign fund outflows weighed on investor sentiment. The Supreme Court also deferred the plea to consider waiver of interest on interest for loan EMI during six months moratorium period. Going ahead, we expect the markets to remain volatile and in a consolidation mode for sometime, as investors would track global cues and development around India-China border issues. Further the market would watch out for telecom AGR hearing tomorrow. We would advise investors to look for buying opportunities on declines in market and also focus more on stock specific action’’, Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services said.

“The geopolitical tensions between India and China have brought back the risk-off mood. We don’t expect the dispute to escalate and both the sides will contain it. Any escalation or uncertainty will lead to a sharp bull-run in the spot rupee-dollar. Until 76 doesn’t break in the rupee dollar spot, it will continue to remain afloat. The immediate support lies around 75.75, and resistance around 76.50’’, Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services said.



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