Profit booking pauses stock market recovery
By S Jha
New Delhi, October 19: After a phenomenal rebound in the equity market, triggered by an extraordinary Dow Jones rally, profit booking took control of the bourses on Wednesday, capping the gains a day before the weekly expiry. After four days of strong gains, the bourses took a pause, with the midcaps and smallcaps reporting heavy profit booking even while the indices heavyweights sought to keep the Indian stock markets steady.
HDFC twins sought to take the Indian stock markets higher, but the profit booking returned, as the indices were on an extended run, with Nifty even crossing the 17600 level during the day, which was being seen the higher range of the rally. The traders have been betting on the Nifty to stay range bound between 16850 to 17600.
Reliance Industries, an index heavyweight, sought to launch itself on a strong rally, gaining over two per cent during the day, to give stability to the stock markets. Axis Bank continued with its phenomenal run, seen from the level of 760 last week to touch the level of 838 today, as the scrip has clearly emerged the leader of the Bank Nifty pack. Axis Bank with the acquisition of the Indian operations of the CITI bank is expected to be on a strong growth trajectory. It must be noted that Bank Nifty has given the leadership to the Indian stock markets, with better quarterly results, boosting the investors’ confidence.
Data Patterns, the private defence electronics manufacturer reported profit booking after the scrip in the early hours touched the levels of Rs 1440, following a spectacular rally from the levels of around Rs 800 a few weeks ago, while it had listed its IPO in December last year at Rs 540. With the DefExpo2022 pitching for Indian defence manufacturers to enter the global market in a big way there is a significant buzz around the defence stocks.
The housing finance companies were in demand today, while the likes of Venus Pipes and Nippon Battery traded strongly on the bourses. Dow Jones on Wednesday afternoon reported profit booking, which may set the tone for the Thursday expiry in the Indian stock markets, with the likelihood of a pause and range bound indices. The chartists are betting on a retracement of the indices.
The foreign institutional investors were again on the selling side, with a net sell of Rs 454 crores. The FIIs have been selling the Indian equity markets consistently amid the unabated strengthening of dollar. The domestic institutional investors have in contrast been net buyers for a few days, and they had a net buy of Rs 908 crores on Wednesday also.
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