Indian Stock Indices Dip Despite Partial Recovery Amid Profit Booking

Indian stock indices Sensex and Nifty closed lower due to profit booking after reaching lifetime highs. Markets erased half of Tuesday's gains with major sectoral indices in red. Investors anticipate challenges ahead of the earnings season and high budget expectations.

Devdiscourse News Desk | Updated: 10-07-2024 16:32 IST | Created: 10-07-2024 16:32 IST
Indian Stock Indices Dip Despite Partial Recovery Amid Profit Booking
Representative Image. Image Credit: ANI
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Indian stock indices settled lower today, though recovering some portion of their intra-day losses due to profit booking. Investors seemed to have resorted to profit-booking after a stellar run, with both key indices touching fresh lifetime highs on Tuesday.

On Wednesday, the indices - Sensex and Nifty - closed half a per cent lower, respectively. A majority of the NSE sectoral indices were in the red today. "Markets fluctuated sharply within a range and ended up losing nearly half a percent, wiping out the gains from Tuesday's session. After a flat start, Nifty plunged sharply in the early hours but a recovery in select heavyweights helped pare some losses as the day progressed," said Ajit Mishra, SVP, Research, Religare Broking.

"The intraday slide in the index has slightly dented sentiment, but resilience in certain pockets limited the damage," added Mishra. Vinod Nair, Head of Research at Geojit Financial Services, commented, "The Indian market experienced profit booking ahead of the upcoming earnings season. The expectations are muted given a slowdown in sales growth due to the global economic slowdown and high inflation-driven margin consolidation."

Additionally, the market is under temporary risk from high budget expectations, which have been well factored into the last month's rally, noted Nair. He said broader indices lagged large caps and the FMCG sector, which are expected to drive momentum due to a stable business outlook.

Sensex and Nifty have accumulated 11-12 per cent returns so far in 2024-25. Strong buys by both foreign and domestic institutional investors have supported the stock markets. Going forward, market participants will closely monitor policy decisions of the new government. Finance Minister Nirmala Sitharaman, who retains her portfolio, will present the full Budget for 2024-25 on July 23.

(Disclaimer: With inputs from agencies.)

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