Stock market closing: Markets take a cautious stance ahead of the budget

Both Sensex and Nifty closed the day in red. While Sensex dipped around 102.57 points during the day to close at 80,502.08 points, Nifty ended the day at 24,509.25 points, down by 0.09% on July 22, 2023.

As for broad-market indices, all closed in green except for Nifty50. While Nifty next 50 inched up 1.28% during the day, midcap 50 also jumped up by 1.74%, while India VIX inched up almost 4.13% to close the day. Amidst sectoral indices, FMCG, IT, realty, media and oil and gas closed the day in red. On the other hand, metal, pharma and healthcare gained over 1% each during the day.

Out of the 2,817 stocks traded during the day, 1,544 saw advances, while 1,179 declined. Another 94 stocks remained unchanged. 70 stocks hit their 52-week high prices, while 33 stocks hit their 52-week low as well. 113 stocks closed the day post touching the upper circuit, while 122 stocks remained in lower circuit during the day.

Grasim (up by 2.58%), UltraTech Cement (up by 2.41%), NTPC (up by 2.22%), HDFC (up by 2.16%) and Mahindra and Mahindra (up by 2.03%) were amongst the top gainers during the day, while Wipro's stock took a significant hit and was down by 9.31%. Reliance (down by 3.42%), Kotak Bank (down by 3.25%), ITC (down by 1.74%) and SBI Life (down by 1.74%) were amidst the leading laggards.

FM Nirmala Sitharaman tabled the Economic Survey 2023-24 earlier today in the parliament, painting a positive picture of the economy for the short-term. Per the survey, the economy 's real GDP grew at about 8.2% in FY24, while it also managed to trim down its fiscal deficit from 6.4% of GDP in FY23 to 5.6% of GDP in FY24. The economy is expected to grow at about 7% over the medium term, with unemployment rates also sobering to 3.2% in 2022-23.

Cautious outlook ahead of budget

Mr. Ajit Mishra – SVP, Research, Religare Broking Ltd notes that the markets began the week on a subdued note and ended nearly unchanged, reflecting caution ahead of the Union Budget. The Nifty index opened lower and fluctuated within a range before closing at the 24,509.25 level. Initially, weak global cues and pressure on index heavyweights like Reliance and Kotak Bank following their earnings reports weighed on sentiment, he said.

"However, the strength in banking major HDFC Bank, in reaction to its results, and continued buoyancy in IT heavyweight Infosys Ltd offset the negativity. Sector-wise, auto, metal, and pharma edged higher, while realty and IT were among the top losers. With all eyes on the Union Budget, volatility is expected to remain high on Tuesday. We thus maintain a cautious stance and recommend a hedged approach. Traders should seek buying opportunities in low-beta counters, especially in the defensive sectors, and remain selective in other areas", continued Mishra.

Aditya Gaggar, director of Progressive Shares highlights that the oversold condition coupled with a bullish divergence in the RSI saved the Index from a steep fall. Mixed market activity was seen where the mid and small caps soared higher while the index stayed in a well-maintained range to end the session at 24,509.25 with a marginal loss of 21.65 points.Auto and pharma sectors advanced over 1% to become outperformers of the day while realty was the major laggard followed by IT.

"Considering the Union Budget outcome, wild swings can be expected on both sides where 24,200 will be considered as immediate support while the higher side seems to be capped at 24,800", explained Gaggar.