Indian equity markets ended largely flat today after a volatile trading session, with benchmark indices struggling for direction. Profit booking, institutional positioning, and stock-specific developments influenced the day’s outcome.
Market Performance Overview
- Sensex closed marginally lower by 0.02%, settling at 74,102.32.
- Nifty 50 ended flat, closing at 22,500.
Investors exhibited caution ahead of the upcoming Consumer Price Index (CPI) data release, which could influence market sentiment in the near term.
Sectoral and Stock Movements
- Banking stocks, particularly IndusInd Bank, witnessed a sharp decline. IndusInd Bank shares plunged over 22% after the bank reported discrepancies in its forex derivatives accounting. This revelation raised concerns about a potential earnings impact of ₹1,500 to ₹2,000 crore, sparking heavy sell-off in the stock. The significant drop weighed on broader banking indices.
- Pharmaceuticals stocks provided some cushion to the indices, with Sun Pharmaceuticals emerging as the top Nifty 50 gainer amid continued investor preference for defensive sectors.
- IT stocks traded weak throughout the session, as concerns surrounding demand in key U.S. markets weighed on investor sentiment.
Institutional Activity
- Foreign Institutional Investors (FIIs) continued their selling streak, recording net outflows of ₹2,823.76 crore in the cash market. This sustained selling is attributed to global economic concerns, caution ahead of key economic data, and profit booking at elevated levels.
- On the other hand, Domestic Institutional Investors (DIIs) stepped in as net buyers, purchasing equities worth ₹2,001.79 crore, mitigating some of the market’s downside pressure.
The divergence in FII and DII flows reflects domestic investor confidence in select sectors despite global uncertainties. DIIs were seen accumulating shares in defensive plays like pharmaceuticals and utilities, while FIIs exited riskier segments, especially in the financial sector.
Commodities Market Update
- Gold prices rose in India, gaining ₹130 per 10 grams to settle at ₹8,800.3. The increase was supported by investor preference for safe-haven assets amid market volatility and upcoming economic data releases.
- Silver prices followed a mixed trend, remaining largely stable in domestic markets despite a slight dip in global demand.
Overview
Markets are expected to remain cautious in the lead-up to the February CPI data release scheduled for March 12, which could provide further clarity on inflation trends and influence the Reserve Bank of India’s policy stance.
With FIIs continuing their sell-off and DIIs selectively accumulating, investors are likely to focus on fundamentally strong stocks and defensive sectors to navigate the ongoing volatility.