Indian stock market looking nervous ahead of Budget: Analyst


Indian stock market tumbled on the monthly derivative expiry day, dragged down by Adani group stocks and a selloff in banking stocks. The Sensex fell nearly 900 points at day’s low while Bank Nifty index tanked over 2%. In noon trade, the Nifty 50 index was down 1.15% at 17,911 while the S&P BSE Sensex fell 1.12% to 60,295.55.

Santosh Meena, Head of Research, Swastika Investmart Ltd, said Indian markets also look nervous ahead of presentation of Union Budget, due on February 1. 

“Indian markets experienced a sharp fall on January F&O expiry day. There is no trigger, but the market is looking nervous ahead of the Union budget,” he said.

“The market is following last year’s pattern because, in 2022, the Nifty saw a doji candle (which indicates a range-bound move) in the second and third weeks of January, followed by a sharp fall in the final week of January. However, that sell-off was a buying opportunity because then we saw a sharp post-budget rally,” he added.

Technically, Santosh Meena said, Nifty is near the critical support level of 17800, and if it falls below this, then 17625 and 17425 are the next support levels. “On the upside, 18200 is a critical hurdle; above this, we can expect a rally toward 18500 and 18650 levels,” he said. 

Stocks of the seven listed Adani group companies fell between 3% and 7% after Hindenburg, a well-known U.S. short-seller, said key listed companies in the group controlled by billionaire Gautam Adani had “substantial debt”, which has put the entire group on a “precarious financial footing”.

The flagship Adani Enterprises fell about 3%, while Adani Ports and Special Economic Zone sank more than 6%. Both were among the top three losers on the benchmark Nifty index.

Adani-owned cement firms ACC and Ambuja Cements fell 6.2% and 6.9%, respectively.

Indian markets will be shut for a local holiday on Thursday, meaning January series derivatives expiry will be on Wednesday.




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