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Informist, Tuesday, Jan. 21, 2025

By Akash Mandal

MUMBAI – Benchmark equity indices ended sharply lower Tuesday, a day when the day's highs were reversed twice, before the indices fell in the last half hour of trading. As investors kept selling shares, India VIX, an indicator of expected volatility, jumped more than 3% in the last hour of trading, before closing 3.9% higher at 17.1. This gauge has now risen for four sessions and is up almost 12% during this period.

The Nifty 50 ended at 23024.65 points, down 320.10 points or 1.4%, and the BSE Sensex ended at 75838.26 points, down 1235.08 points or 1.6%. Banks and financial services stocks led the losses in the Nifty 50. Indices spurted in late morning trade, but the rise was short-lived and in late trade, the Nifty 50 fell below the 23000 point mark for the first time in seven months. Broader market indices were hit harder than benchmark indices, with the Nifty's small- and mid-cap indices ending down 2-2.3%. Only eight stocks in the Nifty 50 ended in the green.

Benchmark indices opened higher, before falling 1% in early trade. Indices then sharply rose back to the levels they had opened at, with the Nifty 50 gaining 267 points in just 10 minutes. However, indices then fell just as sharply, and gave up all gains. After a period of rise during afternoon trading, there was again a dip, before the indices fell to their day's lows in late session trade. Almost 500 points separated the Nifty 50's high and low Tuesday. At close, the Nifty 50 is now down more than 12% from its lifetime high of 26277.35 points, which it reached on Sept. 26. 

The market was very volatile Tuesday, and the exact reasons for it are very difficult to discern, analysts said. However, most analysts believe that the slew of announcements made by Donald Trump on his first day after assuming office as the US president caused uncertainty in the market. 

On his first day, Trump pulled the US out of the World Health Organization and signalled that he would impose a 25% tariff on Canada and Mexico from Feb. 1. "The rise (earlier in the session) might be because investors had discounted all the negatives for a potential pre-budget rally...however, there is a lot of uncertainty, and valuations are not comfortable," Brijesh Ail, head of technical and derivatives at IDBI Capital, said.

All sectoral indices were down, with the Nifty Realty and Nifty Consumer Durables declining more than 4% lower each. Heavyweight stocks such as ICICI Bank and Reliance Industries ended down 3% and 2.4%, respectively. Shares of Trent fell 5.8% and were the worst hit in the Nifty 50. Meanwhile, shares of Apollo Hospitals Enterprises ended 2% higher after media reports said brokerage Kotak Institutional Equities upgraded the stock to 'buy' from 'add' and raised the target price slightly to INR 8,270. 

Among stocks, shares of Dixon Technologies (India) fell almost 14% after the company's consolidated net profit for the December quarter missed analysts' estimates. Tuesday's losses broke a five-session winning run for the stock. Shares of Zomato also fell more than 10% after the company's consolidated net profit missed analysts' estimates by a wide margin. The company reported a consolidated net profit of INR 590 million for the December quarter, compared to INR 2.44 billion expected by analysts. Shares of Oberoi Realty ended more than 7% lower after the company's consolidated net profit missed the Street's view. Shares of One97 Communications ended down almost 5% as investors digested management comments about keeping capital expenditure slow in the next fiscal year. The company reported a net loss for the quarter, but still beat analysts' expectations. 

Shares of Global Health, Century Plyboards, and Hindustan Petroleum ended up 2.7-5.4% and were the top gainers in the Nifty 500. Meanwhile, shares of Newgen Software Technologies slumped 16.2% and were the worst hit in the Nifty 500. The stock has declined for four consecutive sessions, and fallen more than 25% during this period. Shares of Multi Commodity Exchange of India fell almost 9% despite the company reporting a consolidated net profit of INR 1.60 billion for the December quarter, compared to a net loss a year ago. 

* Of the Nifty 50 stocks, 8 rose and 42 fell

* Of the Sensex stocks, 3 rose and 27 fell

* On the NSE, 715 stocks rose, 2,095 fell, and 77 were unchanged

* On the BSE, 1,187 stocks rose, 2,788 fell, and 113 were unchanged

* Nifty Realty: up 4.1%; Nifty Consumer Durables: down 4.1%; Nifty FMCG: down 0.2%

BSE                                                 NSE

75838.26 points, down 1235.08 points or 1.6%        23024.65 points, down 320.10 points or 1.4%

End

Edited by Avishek Dutta

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