Stock market today: Nifty 50, Sensex drop on profit booking, mid and smallcaps bleed

Indian benchmark indices, which began Monday's trading day on a positive note due to a sharp uptick in index heavyweight HDFC Bank, failed to sustain their rally as the session progressed. A significant sell-off in Kotak Mahindra Bank and other heavyweights pulled the indices lower, resulting in a negative finish for the day.

Profit booking by investors at higher levels added further pressure to the market. The Nifty 50 wrapped up the session with a drop of 0.29%, closing at 24,781, while the S&P BSE Sensex finished the day 0.09% lower at 81,151. 

Out of the 50 stocks in the Nifty 50 pack, 36 closed in the red, with Tata Consumer Products leading the decline at 7%. It was followed by Kotak Mahindra Bank, Bajaj Finserv, BPCL and IndusInd Bank, all of which experienced losses exceeding 3%.

Additionally, other notable stocks such as Trent, Adani Enterprises, Adani Ports & SEZ, Hindalco Industries, Britannia Industries, Cipla, Bajaj Finance, Bharat Electronics, UltraTech Cement, and Grasim Industries recorded declines of over 1.5%.

On the gainers' side, Bajaj Auto, HDFC Bank, Asian Paints, Mahindra & Mahindra, and Eicher Motors rose up to 4%.

In contrast, the broader market experienced significant selling pressure today, with the Nifty Midcap 100 index plunging 1.66% to 57,677. Meanwhile, the Nifty Smallcap 100 index fell to 18,797, down 1.47% from the previous closing level.

The Q2 FY25 earnings season has provided little cause for optimism thus far, exhibiting generally subdued underlying trends across sectors. This has adversely affected investor sentiment, as most stocks are trading at elevated valuations that necessitate strong performance to sustain these levels.

Commenting on today's market performance, Vinod Nair, Head of Research, Geojit Financial Services, said, "The domestic market displayed considerable volatility, with key indices swinging between negative and positive terrain. PBOC has further reduced interest rates by 25 bps to support its struggling economy. Meanwhile, FIIs continued their strategic buying in China while selling off in India, driven by weaker corporate earnings and valuation concerns. Concurrently, domestic Q2 earnings have been mostly underwhelming, with major private sector banks notably disappointing. However, DIIs have offered some support, mitigating the market’s decline."

Sectoral performance

Among sectoral indices, the Nifty Auto index concluded the session with a gain of 0.42%, marking its second consecutive day of gains. The rebound in Bajaj Auto shares, supported by Mahindra & Mahindra, significantly contributed to the index's positive performance.

Aside from the auto sector, all other major indices closed in the negative territory. The Nifty Media index fell by 2.83%, while the Nifty Metal, Nifty Oil & Gas, Nifty FMCG, Nifty Realty, and Nifty IT indices all recorded losses of over 1%. Nifty Bank ended the session with a cut of 0.25% at 51,962.

PNC Infratech, Indiamart Intermesh, and RBL Bank lead Nifty 500 losers

Over 350 constituents of the Nifty 500 index closed in the red, with PNC Infratech leading the losses, experiencing a sharp drop of 20% to ₹366.80 per share after the Ministry of Road Transport & Highways disqualified the company and its two subsidiaries from participating in ministry tenders. In an exchange filing, PNC Infratech confirmed that it has been barred from tender processes for one year, effective October 18, 2024. This disqualification also extends to its subsidiaries, PNC Khajuraho Highways and PNC Bundelkhand Highways.

Indiamart Intermesh also faced significant selling pressure, falling 17% to ₹2,508 per share, prompted by brokerage firms lowering their target prices following the company's Q2 FY25 performance.

Jefferies downgraded the stock from 'buy' to 'underperform,' reducing its target price to ₹2,540 per share, while Nomura adjusted Indiamart’s price target to ₹3,150 from ₹2,520, maintaining a 'neutral' rating. Phillip Capital also downgraded the stock to 'neutral' from 'buy,' cutting its target price to ₹3,400.

RBL Bank was another stock that faced heavy selling pressure after its Q2 FY25 performance fell below street estimates, sparking target price cuts from several brokerages. The stock closed down 14.19% at ₹176, the lowest level in the last six months.

Amber Enterprises, Tejas Networks lead top gainers

Shares of Amber Enterprises surged 17.4% to ₹6,344 apiece ahead of the announcement of the company's Q2FY25 results on Tuesday. Tejas Networks also saw a sharp gain of 11%, closing at ₹1,318 apiece after posting a robust set of numbers for the September quarter.

Tata Chemicals and Tata Investment Corporation jumped up to 10% on Monday following reports that the Reserve Bank of India (RBI) rejected Tata Group's request to exempt its holding company, Tata Sons, from mandatory listing on stock exchanges.

Tata Sons will now have to list itself by September 2025 as RBI has turned down a proposal seeking exemption from listing its equity shares, ET Now reported, citing sources.

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