Auto & FMCG Zoom, IT & Energy Drag; Rupee Weakens
BUSINESS DESK
It was a day of high drama on Dalal Street as the markets staged a 900-point bull charge at the opening bell on the back of GST 2.0 euphoria, only to surrender most of the gains by the closing bell.
The Sensex touched a record 81,456.67 in early trade but fizzled out to settle at 80,718.01, up just 150 points. The Nifty 50 too cooled off from its highs, closing at 24,734.30, up a mere 19 points.
“The market had all the ingredients for a blockbuster rally—GST reforms, auto and FMCG tailwinds, strong opening momentum. But profit-booking in heavyweight IT and energy names pulled the rug mid-session,” said Ajit Mishra, SVP, Research, Religare Broking.
Sector Snapshot: Who Ruled, Who Sank
- Auto on Overdrive: Mahindra & Mahindra and Tata Motors revved up expectations of a GST-driven consumption push.
- FMCG Shines: ITC and Asian Paints painted the market green, buoyed by hopes of cheaper daily essentials.
- Banking Boost: HDFC Bank and ICICI Bank added muscle, riding on financial reforms momentum.
- Tech Troubles: Infosys, HCL Tech, and Tech Mahindra dragged the indices, reflecting global IT demand worries.
- Energy & Power Slip: NTPC, PowerGrid, and Tata Steel weighed heavy as investors booked profits.
- Realty Under Pressure: Realty stocks lost sheen amid concerns of high valuations.
Big Picture
The GST 2.0 reforms are being hailed as a structural game-changer, with reduced levies on essentials and higher taxes on luxuries—seen as a recipe for a consumption-led recovery. Analysts expect autos, consumer staples, and rural-linked infrastructure to stay in the limelight.
But caution lingers: FIIs remained net sellers, and the rupee weakened to 88.11 per dollar, reflecting global jitters.
The bulls still have fuel, but for now, the bears are keeping them on a short leash.
Sectoral Pulse
- Banking & Financials: Mixed bag. While PSU banks saw profit booking, private lenders like ICICI and Axis held firm. L&T Finance gained on integration updates.
- FMCG & Staples: Outperformed. GST cuts lifted sentiment for players like Britannia, Nestlé, and Tata Consumer. Expect volume-led growth in Q3.
- Metals: Steel Authority of India (SAIL) surged 5%, breaking past ₹127 resistance. Analysts see ₹140 as next target.
- IT & Tech: Rangebound. Infosys and TCS traded flat amid global tech rotation. Watch for cues from U.S. labor data.
- Auto & Discretionary: Maruti and M&M gained on festive demand outlook. EV buzz continues to support valuations.
Global Cues
- U.S. Futures: Mixed ahead of key jobs data. Nasdaq buoyed by Alphabet’s antitrust win and Apple’s breakout rally.
- Asia: Nikkei strong (+1.23%), but Hang Seng and Shanghai Composite under pressure.
- Crude Oil: WTI slipped to $63.50/barrel. Cooling inflation fears may aid RBI’s rate stance.