The Nifty index experienced a sharp downturn on Wednesday, marking a significant decline of 1.41 percent or 302.9 points, closing at 21,150.6, according to Deepak Jasani, Head of Retail Research at HDFC Securities. Notably, cash market volumes on the NSE remained below Rs 1 lakh crore, amounting to Rs. 0.94 lakh crore. The broader market indices exhibited a more pronounced fall compared to Nifty, with the advance-decline ratio plummeting to 0.11:1, the lowest recorded in nearly a year.
This session marked the most substantial one-day fall for Nifty in the past year, signifying a potential short-term correction. Jasani highlighted the 20950-21006 band as the anticipated target in the near term. On the upside, resistance is anticipated in the 21235-21365 band, potentially limiting upward movements.
Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services, attributed the current market scenario to a sell-off phase following a significant surge of over 12 percent in the last seven weeks. He noted that the market might undergo a consolidation phase as investors engage in profit booking, especially considering the potential risks associated with the resurgence of COVID cases, particularly in states like Kerala and Karnataka. This cautious approach among investors could contribute to the market's tentative stance in the near future.
(With Agency Inputs)
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