The market plunged on Wednesday as investors turned cautious ahead of the start of the first phase of polling and renewed concern on global economic growth after IMF downgraded the growth forecast to 3.3 per cent for 2019.
The Sensex was down 353 points top close at 38,585, while the Nifty ended at 11,584, down 87 points.
Selling was in heavyweights like Reliance, HDFC, TCS led the fall in the Index. Asian Paints, Hindalco, Bharti Airtel, and UPL were the top losers, while Tata Motors, Wipro, HUL, Cipla and Adani Ports were among the major Nifty gainers.
Except auto and pharma, all other sectoral indices ended in red led by bank, metal, FMCG, IT, infra and energy.
According to analysts, election led consolidation may be short lived and the key trigger will be the earnings growth which is expected to start revive from fourth quarter onwards.
Market View
"The markets have been sharply volatile over the past week in a narrow range, as market is consolidating the gains of ferocious rally of previous fortnight. The buying from foreign investors has remained relentless and unabated. However, a bit of correction of post strong rally may be healthy for the market, said Jagannadham Thunuguntla, Sr. VP and Head of Research (Wealth), Centrum Broking Limited.
"The movement going forward will be driven by results season and political developments. Investors shall remain focused on the quality stocks as markets can turn further volatile in the next fortnight, " he further said.
Technical View
According to technical analysts, the market is in a consolidation range, at the lower end of the range of 11569 - 11549. And sustainable move below this would result into an extended correction.
"The Nifty closed in the negative territory in the last trading session and it has reversed from the upper end of the falling channel, hence it is likely to slide towards the lower end of the channel. The Index has now got stuck between the channel which has a range of 11500-11700 levels. Hence, wherever there will be a breakout from this range there will be 200 points move till then there will be a sideways movement in the Index," Jay Thakkar Head Technical and Derivatives Research - AVP Equity Research, Anand Rathi Shares and Stock.
