Stock market today: Nifty 50, Sensex end with mild losses on Budget 2024 eve; mid, smallcaps rally

Stock market today: Continuing their losing streak for a second consecutive session, Indian stock market benchmarks, the Nifty 50 and the Sensex, closed in the red on Monday, July 22, ahead of the Union Budget 2024.

The fall in key indices could be largely attributed to the poor show of select heavyweight stocks such as Reliance Industries, Kotak Mahindra Bank, ITC and Wipro. However, gains in shares of HDFC Bank, Infosys and Mahindra and Mahindra underpinned the indices.

Nifty 50 closed the day 22 points, or 0.09 per cent, lower at 24,509.25, while the Sensex closed the day 103 points, or 0.13 per cent, lower at 80,502.08.

Mid and small-cap segments of the market witnessed healthy gains, shrugging off caution ahead of the Budget.

The BSE Midcap index rose 1.27 per cent, while the Smallcap index climbed 0.83 per cent.

“After a sharp fall in early trades, markets were in a recovery mode and ended with marginal losses on profit-taking in banking, IT and realty stocks. Investors traded with caution as nervousness gripped them ahead of tomorrow's Budget. However, markets could see volatility during the Budget announcement on Tuesday, and one may see sector-based action,” said Prashanth Tapse, Senior VP (Research), Mehta Equities.

Experts expect the Budget to keep its focus on fiscal prudence and boost the manufacturing and infrastructure sectors.

Meanwhile, the Economic Survey 2023-24 highlighted the resilience of the Indian economy and projected continued strong growth in FY25, subject to geopolitical, financial market and climatic risks.

Thanks to gains in the mid and small-cap pockets of the market, the overall market capitalisation of BSE-listed firms rose to nearly ₹448.5 lakh crore from nearly ₹446.3 lakh crore in the previous session.

28 stocks ended in the green in the Nifty 50 index, while 22 stocks ended in the red.

Shares of Grasim (up 2.58 per cent), UltraTech Cement (up 2.41 per cent), and NTPC (up 2.22 per cent) ended as the top gainers in the index. On the flip side, shares of Wipro (down 9.31 per cent), Reliance Industries (down 3.42 per cent) and Kotak Mahindra Bank (down 3.25 per cent) ended as the top losers in the index.

Among the sectoral indices, Nifty Auto (up 1.15 per cent), Healthcare (up 1.10 per cent), Pharma (up 1.06 per cent) and Metal (up 1.02 per cent) indices clocked healthy gains.

However, Oil & Gas (down 0.62 per cent), Realty (down 0.48 per cent), Media (down 0.47 per cent), IT (down 0.38 per cent) and FMCG (down 0.34 per cent) ended with losses.

Shrikant Chouhan, the head of equity research at Kotak Securities, pointed out that the Indian stock market is currently exhibiting non-directional activity around the 24,500/80,400 level following a reversal formation.

"With Budget Day looming, we anticipate heightened volatility. The 24,500/80,400 level serves as critical support for the bulls, while 24,850/81,600 could pose as the primary resistance zone for traders," said Chouhan.

"A shift in sentiment may occur if the index falls below 24,500/80,000, potentially leading to a drop to 24,150-24,000/79,000-78,600, supported by retracements and the 20-day SMA (simple moving average). Reducing long positions during rallies is recommended as long as the market is trading below 24,850/81,600," said Chouhan.

"Buying is advisable only at major support levels (24,150/79,000 and 24,000/78,600) with a medium to long-term perspective. If the market surpasses 24,850/81,600, it has the potential to advance towards 25,000/82,000 and 25,300/83,000 levels," Chouhan said.

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