Markets

Sensex drops 151 points on heavy selloff in auto stocks

Brokers said auto sector stocks were the centre of nervous selling, triggered by dismal quarterly earnings posted by leading auto makers. File

Brokers said auto sector stocks were the centre of nervous selling, triggered by dismal quarterly earnings posted by leading auto makers. File   | Photo Credit: Reuters

Sensex ended at 36,395.03, down 151.45 points, or 0.41%; NSE Nifty finished 49.80 points, or 0.50%, down at 10,888.80

Indian equities extended their fall for yet another session on Monday, with the BSE Sensex falling over 150 points and the NSE Nifty slipping below the 10,900 mark, as selling pressure continued in the market despite a rebound in global stocks.

Brokers said auto sector stocks were the centre of nervous selling, triggered by dismal quarterly earnings posted by leading auto makers.

The 30-share barometer after shuttling between 36,588.41 and 36,300.48 points, finally ended at 36,395.03, down 151.45 points, or 0.41%. The gauge had lost nearly 429 points in the previous two sessions.

The 50-scrip NSE Nifty finished 49.80 points, or 0.50%, down at 10,888.80, after touching a low of 10,857.10 and a high of 10,930.90 during the session.

“Selling pressure continued in the market despite a rebound in global market as investors turned risk averse due to upcoming election,” said Vinod Nair, Head of Research, Geojit Financial Services.

Quarterly results have not surprised investors while scope of downgrade in earnings further dampened the sentiment, he said adding that “global trade deal and risk of slowdown in growth continue to give caution while investors remain focused on tomorrow’s CPI inflation and IIP data to get some direction.”

Auto segment stocks continued to trade in the red with M&M emerging as the biggest loser in the Sensex pack by plunging nearly 5% after it reported 11.44% decline in standalone profit after tax (PAT) at ₹1,076.81 crore on Friday for the third quarter ended December 31, 2018.

Meanwhile, domestic passenger vehicle (PV) sales declined for the third month in a row in January, dropping 1.87%, as manufacturers continued to reduce inventory at dealers following a tepid festive season sales, according to Society of Indian Automobile Manufacturers (SIAM).

Other losers include ONGC, Bajaj Finance, Reliance, SBI, Hero MotoCorp, ICICI Bank, L&T, Vedanta, Yes Bank and Axis Bank, falling up to 2.54%.

Shares of Dr Reddy’s Lab faced the selling pressure, plunging about 6%, after the drugmaker’s Hyderabad-based plant was inspected by the U.S. Food and Drug Administration on Friday.

However, Tata Steel emerged as the top gainer in the Sensex kitty, climbing 2.31% the company on Friday reported a 54.33% jump in consolidated net profit to ₹1,753.07 crore during the quarter ended on December 31, 2019, helped by higher income.

Other gainers include, PowerGrid, HCL Tech, Kotak Bank and Maruti, rising up to 1.36%.

Small and mid-cap indices fell 1.51% and 1.47%, respectively.

Among sectoral indices, healthcare index suffered the most by plunging 1.88%, followed by capital goods by falling 1.46%.

Others indices, led by consumer durables, oil & gas, auto PSU, infrastructure, realty, bankex, FMCG and power indices, also ended in the negative terrain, falling up to 1.46%.

Bucking the trend, teck and IT indices ended in the green.

Meanwhile, on a net basis, domestic institutional investors (DIIs) sold shares worth ₹960.04 crore, while foreign portfolio investors (FPIs) bought shares worth ₹843.73 crore on Friday, provisional data released by the stock exchanges showed.

In the Asian region, Shanghai Composite Index, which re-opened after a week, ended 1.36% higher, while Hong Kong’s Hang Seng gained 0.50%. Korea’s Kospi too ended 0.17% higher. Japan’s financial markets were shut for a public holiday.

European shares were quoting higher in their early deals. Paris CAC 40 was up 0.77% AND Frankfurt’s DAX rose 0.67%. London’s FTSE was also trading 0.65% higher.

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Printable version | Feb 21, 2020 11:06:41 PM | https://www.thehindu.com/business/markets/sensex-drops-151-points-on-heavy-selloff-in-auto-stocks/article26238624.ece

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