Keeping opening gains intact, Indian stocks settle firm

NEW DELHI: Continuing with the gains made during the morning session, Indian stocks closed Wednesday's trade in the green. The markets witnessed a bloodbath during the previous session, with the Sensex falling over 1,000 points due to a host of reasons, including high valuations, foreign portfolio investors lately pulling out funds from India, and a mild profit booking.

Benchmark Sensex and Nifty closed about 1 per cent higher at 71,060 and 21,453 points, up 689 points and 215 points, respectively. Among the widely-tracked Nifty 50 stocks, 43 advanced and the rest 7 declined.

Ajit Mishra, senior vice president, Technical Research, Religare Broking, said, "Markets took a breather after Tuesday's slide and gained nearly a percent amid volatility. The tone was negative at the beginning however rebound in the select heavyweights not only capped the decline but also helped the Nifty to close in the green."

"We thus feel traders should continue with a stock-specific trading approach and maintain positions on both sides," Mishra added.

According to Jaykrishna Gandhi, head, Business Development, Institutional Equities, Emkay Global Financial Services, "We expect the domestic and FPI volumes to remain tepid during the truncated week (markets will be closed on January 26 for Republic Day), as most long-only investors to stay defensive and wait for clear trading trends to emerge in the last week of January. The coming week will also be event heavy with multiple results and the interim budget on Thursday 1st Feb."

Foreign portfolio investors have turned net sellers in the Indian stock market so far in January 2024, after making a beeline to accumulate domestic stocks during the past two months - November and December.

"However, over the medium term we expect flows to pick up gradually, given the inflation stability and expected political steadiness post-elections," said Gandhi.

The latest data available from the National Securities Depository Limited (NSDL) showed that the FPIs sold Indian stocks worth Rs 19,308 crore in January.

Meanwhile, shares of Zee Entertainment Enterprises rose over 6 per cent on Wednesday, after a whopping 30 per cent lower circuit it went through during the previous session following the cancellation of the merger deal with Sony Pictures. The lower circuit is the lower possible price that the stock of a firm can trade at on that particular session.

On Monday, Sony Pictures terminated the USD 10-billion merger deal with Zee Entertainment Enterprises, besides seeking a USD 90 million termination fee from the Indian company. ZEEL categorically denies all the assertions raised by Culver Max and BEPL on the alleged breaches under the terms of the MCA, including their claims for the termination fee.