Sensex, Nifty retreat from record highs on profit-booking, weak macroeconomic data

Mumbai: Equities took a breather on Tuesday after a three-session record setting run as investors dialled down fresh bets amid grim macroeconomic data and firm crude prices. The Sensex shed 72 points to end at 34,771.05, while the broader Nifty finished at 10,700.45 points, down 41.10 points. However, IT stocks surged on widespread buying after a Morgan Stanley report said Indian IT services shares are set for a turnaround in 2018 as recovery in spending is "imminent". Overall sentiment turned weak after data released after market hours on Monday showed that the country's trade deficit, or difference between imports and exports, reached USD 14.88 billion in December, up about 41 percent year-on- year, as crude oil and gold import bill inflated. The BSE 30-share barometer, after a higher start at 34,877.71, advanced to 34,936.03 in morning trade on continued buying by investors driven by encouraging quarterly earnings. However, across-the-board profit booking at record levels pulled it down to a low of 34,735.55. It finally settled 72.46 points, or 0.21 percent lower at 34,771.05. The gauge had gained 410.44 points in the previous three sessions and closed at an all-time high of 34,843.51 on Monday. The wider NSE Nifty too slipped from record but managed to close above the crucial 10,700 mark at 10,700.45 points, down 41.10 points or 0.38 percent. [caption id="attachment_4265433" align="alignleft" width="380"]

Representational image. Reuters[/caption]It shuttled between 10,762.35 and 10,687.85 during the session. On Monday, it had closed at a new life-time high of 10,741.55. Widened fiscal deficit and increasing fuel price on account of volatility in crude prices dampened the market sentiment. "Mid and small caps underperformed but silver lining was seen in IT index on expectation of turnaround in spending," said Vinod Nair, Head of Research, Geojit Financial Services. Meanwhile, domestic institutional investors (DIIs) sold shares worth Rs 173.28 crore on net basis, while FIIs bought equities to the tune of Rs 32.92 crore yesterday, provisional data showed. Coal India was the biggest loser among Sensex components, falling by 4.57 percent, followed by Reliance Industries at 2.54 percent. Other laggards included Tata Motors, Tata Steel, ITC Ltd, SBI, Power Grid, Bharti Airtel, M&M, Asian Paints, HDFC Ltd, Hero MotoCorp, Kotak Bank, IndusInd Bank, Yes Bank, Axis Bank, Maruti Suzuki and Bajaj Auto, losing up to 2.30 percent. In contrast, IT counters like Wipro, Infosys and TCS were the top three performers in the Sensex pack, rising up to 4.88 percent. Stocks of state-run oil marketing companies faced the selling heat on higher global crude prices, which continued to quote at near three-year high of USD 70 a barrel due to production curbs in OPEC nations and Russia. HPCL, BPCL and IOC slipped by up to 3.35 percent. Sectorally, the BSE realty index emerged as the worst performer by falling 3.51 percent, followed by metal 2.83 percent, PSU (2.26 percent), oil and gas (1.84 percent), power (1.78 percent), infrastructure (1.54 percent), consumer durables (1.29 percent), FMCG (1.12 percent) and auto (1.12 percent). IT and teck rallied by 3.32 percent and 2.45 percent, respectively. The small-cap index fell 2.21 percent, while mid-caps declined 1.74 percent. In the Asian region, Japan's Nikkei rose 1 percent, Hong Kong's Hang Seng clocked its highest ever close by gaining 1.81 percent, while China's Shanghai Composite Index inched up 0.77 percent. In the Eurozone, Frankfurt's DAX was higher by 0.41 percent, while Paris CAC 40 rose 0.21 percent in their early deals. London's FTSE was up 0.16 percent.