Sensex erases all gains, Nifty ends below 8,900; broader markets fall 1%

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Benchmark indices pared early morning gains to end the day in red dragged by realty, pharma and telecom stocks.


Both Nifty and Sensex slipped over 1% from day’s high at close. Sensex fell over 300 points while the broader Nifty50 index was down over 100 points from day’s high.


During the early morning trade, the indices reached their 2-year high supported by global cues after the Dow Jones index closed above 21,000 mark for the first time ever as investors were encouraged post President Donald Trump's first speech to Congress. S&P BSE Sensex rose as much as 0.5% or 148 points to 29133 points, a level last seen on March 13, 2015. The broader Nifty50 rallied 0.5% or 44 points to 8,989, a level last seen on March 4, 2015.


The S&P BSE Sensex settled the day at 28,840 down 145 points, while the broader Nifty50 ended at 8,899, down 46 points.


The broader indices underperformed the frontline indices with BSE Midcap and BSE Smallcap indices falling over 1% each.

"Nifty lost over half a percent after making a new 52-week high around 9000 in early trade. Firm global cues led a gap up start but existence of psychological hurdle and overbought market situation pulled the index gradually lower as the day progressed.  It is a normal profit taking which may extend further; however, the downside also seems capped. At the same time, stocks may witness volatile swings during the consolidation phase, so traders should remain extra cautious in stock selection and focus on trade management," said Jayant Manglik, President, Retail Distribution, Religare Securities in a note.


Sectors and Stocks

Realty index was the biggest sectoral laggard, down over 4% dragged by DLF (down 8.1%), Indiabulls Real Estate (down 5.9%) and Sobha (down 5.6%).


The BSE Auto index was the best performing sector, with Tata Motors rising 2.7% after posting a 2% jump in February total sales.


Bajaj Auto also gained over 2% after auto sales data. Its total sales increased to 2.73 lakh units in February 2017 from 2.72 lakh units in year-ago month, driven by exports.


Shares of Railway-linked stocks such as Titagarh Wagon and Texmaco Rail soared up to 6% during the day after the railway minister Suresh Prabhu presented Indian Railways Freight and Passenger Business Action Plan 2017-18, which railway officials are terming as "mini-budget". Titagarh Wagons later gave up some gains to end the day 2% higher while Texmaco Rail settled the day flat. 


Biocon shares fell over 7% dragging the pharma index after reports that the company will see two crucial inspections later this month and in early April. Company’s manufacturing sites will come up for inspections by the European medicines agency later this month and next will be an inspection by the US FDA.


Wockhardt declined as much as 6.5%, after the US Food and Drug Administration (FDA) issued a warning letter to the company's Morton Grove plant, which will withhold all FDA approvals until a resolution is made. The stock ended over 4% down for the day.


All except 2 telecom stocks settled the day in red with RCom, falling the most, down near 4%. Idea Cellular and Bharti Airtel fell .5% and 1.7% respectively.


Global Markets


Asian shares rose on Thursday as investors were encouraged by President Donald Trump's less combative tone in his first speech to Congress, which sent Wall Street stocks sharply higher, while growing bets on a US rate hike this month buoyed the dollar.


MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.5% while Japan's Nikkei rose 1.3% to a 14-month high.


European shares steadied early on Thursday, pausing after a strong rally in the previous session. The pan-European STOXX 600 index was flat in percentage terms.


MSCI's broadest gauge of the world's stocks covering 46 countries scaled a record high, a day after it rose nearly 1% for its biggest daily gain in almost three months.


On Wall Street, the Dow Jones Industrial Average blasted through the 21,000-point mark for the first time. Both the Dow and the S&P 500 rallied around 1.4%.

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