Indian benchmark indices closed lower on Thursday, dragged by IT stocks following disappointing Q3 results from Tech Mahindra and as financial stocks continued to retreat.
The 30-share BSE benchmark Sensex declined 360 points or 0.51% to settle at 70,700. The broader NSE Nifty fell 101 points or 0.47% to end at 21,352.

They have fallen about 1.3% each over the three sessions this holiday-truncated week, logging their worst performance since the week ending October 27.

Indian markets will remain shut on Friday on account of the Republic Day holiday.

High-weightage financials led the losses for a second straight week, adding 1.6% to their 4.1% drop last week that was sparked by HDFC Bank reporting disappointing margins.

In the six sessions since then, foreign funds have sold Indian shares worth Rs 347.66 billion ($4.18 billion), pulling the Nifty 50 down about 3%.

Tech Mahindra plunged 6% and was the top BSE Sensex loser after it posted a smaller-than-expected quarterly profit due to weak client spending.Nifty Financial Services, the heaviest weighted among the major sectors, fell 0.5%. It has tumbled 6% since HDFC Bank reported disappointing margins last week.

Meanwhile, Nifty FMCG, IT, Pharma, and Healthcare closed over 1% lower each. Whereas, Nifty auto, media, and metal closed higher.

Among individual stocks, Bajaj Auto closed 5.3% higher after the automaker beat profit expectations, helped by strong domestic demand.

RailTel Corporation also closed over 10% higher after the firm reported 94% YoY growth in profit after tax to Rs 62 crore in Q3 of FY24 as against Rs 32 crore in the corresponding period of the previous year.

The market breadth was skewed in favour of the bulls. About 2,133 stocks gained, 1,677 declined, and 89 remained unchanged on the BSE.

Expert Views

The benchmark indices closed on a negative note taking cues from the global market as the positive upside coming from the US economy delayed the optimism of a rate cut, said Vinod Nair, head of research at Geojit Financial Services.

“FIIs are in a selling mode as the yields on US benchmark bonds rise. The broader market is unable to hold gains as the concerns of high valuations, subpar results, and persisting geopolitical tension in the Middle East, followed by an F&O expiry, are weighing down the market,” Nair added.

Prashanth Tapse, senior VP (Research) at Mehta Equities, said, “On the technical front, with the immediate resistance being at 21,400 mark, we expect the market to go down further towards 21,100 and 21,000 eventually, and if it breaks 21,000 level we can witness more selling pressure up to 20,900-20,500 levels. Any trend change would happen only once the Nifty surpasses the 21,500 mark.”

Global Markets

Chinese blue chips staged a robust rally, with the Shanghai Composite up 3% in its largest daily gain in nearly two years, after a series of measures by Beijing authorities to prop up the economy and the stock market.

The gain, however, was not enough to keep the MSCI All-World index in positive territory, given weakness in European equities and flat US stock index futures.

Oil Rises

Oil prices rose on Thursday after data showed US crude stockpiles fell more than expected last week, while the Chinese central bank’s cut in banks’ reserve ratio reinforced hopes of more stimulus measures and economic recovery.

Brent crude futures were up 97 cents, or 1.2%, to $81.01 a barrel, while U.S. West Texas Intermediate crude was up $1.03, or 1.4%, to $76.12 a barrel.

Currency Watch

The Indian rupee ended little changed on Thursday after hovering in a tight range through much of the session with traders awaiting fresh cues for directional momentum.

The rupee ended at 83.1150 against the US dollar, barely changed from its previous close at 83.1225. The local unit posted a marginal weekly loss of 0.06%.

(With input from agencies)

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