The broader market continued in its southward journey today and a rate cut to the extent of 25 bps by RBI failed to lift sentiment for long enough. While one reason could be that the said interest rate cut was widely expected by the participants and hence were largely discounted previously, the other reason could well be that the prices were still overbought and needed some pause within a longer term bull market. Consequently we witnessed the old adage of ‘buying on rumor and selling on news’ to assert itself once again in today’s session.
Nifty finally settled at 11598, down 45 points or 0.39% for the day. Over the past two days Nifty declined nearly 163 points from its life high made yesterday & many traders are seriously weighing the possibility of a potential double top formation rather than newer life highs going forward.
Except for Auto, Media & Pharma, all sectoral indices closed in red today, IT being the one hit worst. Some individual stocks like IBulHousing Finance, Tata Motors or Bharti Airtel etc however bucked the trend and registered smart gains. There is a rumor in the market that Ambani’s & Mittal’s have expressed desire to buy Zee & this saw buying interest in this stock today. Next few days are also likely to see excess volatility in this counter.
