After two successive days of decline, equity benchmarks closed almost flat on Wednesday amid intraday volatility. Initially, sentiments were downbeat in response to disappointing quarterly results from companies such as Tata Motors and Tech Mahindra. Besides, weakness in global markets was also weighing on the sentiment. However, some support came with recovery in selective index majors as day progressed, which helped index to close flat. Despite unchanged closing in benchmarks, sectoral indices traded mixed while market breadth ended slightly on the negative side.
At the close, the benchmark 30-share index, BSE Sensex added 33.25 points or 0.12% at 27,564.66 while the broad based NSE Nifty closed flat with a decline of 4.75 points or 0.06%, at 8,334.60.25.
Commenting on the outlook, Jayant Manglik, President-retail distribution, Religare Securities said, "Due to F&O expiry, we shall be seeing excessive volatility across the board on Thursday so traders are advised to uphold strict risk management rules. Needless to say, any rebound in index would attract selling pressure so select your trading bets accordingly. Among sectoral indices, metal, PSU banks and realty are the weakest so one can choose stocks from these sectors for fresh short positions."
Meanwhile, Vinod Nair, Head-Fundamental Research, Geojit BNP Paribas Financial Services said, "Market is floating on hope of rate cut. Currently it is volatile and trading in range. The trend will move as per the consensus and outcome, which develops by the event date. Looking at global prices, both soft and hard commodities are much lower. Hence in the medium-trend CPI should lower. But the risk is to currency which is depreciating, though outperforming to peers. Based on RBI target of 6% CPI, it does provides a room to cut rate, the question is by when and how much. This will depend on global factors which are supportive now. Also RBI will be concerned on currency due to US rate hike. But looking at peers like China the rate trend is downward."
Hiren Dhakan, Associate Fund manager, Bonanza Portfolio opined, "Markets are currently discounting the probable turbulence in Eurozone and the deterioration of financial liquidity for Greek government combined with political uncertainty in Spain. The probability of rate hikes by Fed in coming quarters, coupled with Eurozone fears and instability in crude inventory would keep Rupee/Dollar rates volatile and thus the Indian markets as well. We believe the markets to remain weak for upcoming trading sessions and remain between 8,100-8,400 in the near term."
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