Stock market today: Nifty 50, Sensex fail to hold gains, close flat in choppy trade; metal stocks hit hard

Stock market today: Indian benchmark indices ended Tuesday's trade marginally lower after witnessing a relief rally in the previous session that helped break the five-day losing streak. 

Analysts suggest that markets are likely to remain rangebound for the entire week, as there are no fresh triggers to ignite bullish sentiment. They also expect the narrow momentum to continue into the start of next month, ahead of corporate earnings season.

FMCG and auto stocks provided some support to the market in today's session, while metals and PSU stocks dragged the indices lower. The Nifty 50 closed down by 0.11%, settling at 23,727, while the Sensex ended with a minor 0.09% drop at 78,472.

Similarly, the Nifty Midcap 100 index concluded the session with a 0.06% decline at 57,057, while the Nifty Smallcap 100 index managed to end the session with a gain of 0.24%, settling at 18,732.

Dr V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said, "The relief rally witnessed yesterday is unlikely to have a free run-up in the coming days. Two sets of factors—external and internal—will restrain a sustained rally. Externally, the strong dollar and high bond yields in the US will prompt the FIIs to sell on rallies. Internally, the growth and earnings slowdown will be near-term negatives that will restrain the bulls. The high valuations in the market in this challenging macro backdrop cannot favour a PE expansion, which can take the market significantly higher."

"Investors should prioritise safety over returns in the current context. Fairly valued segments like large-cap financials, sectors like pharma and IT that will have stable demand, and fast-growing segments like digital stocks are likely to remain relatively resilient in a challenging environment," he added.

Sectoral Performance: Auto shines, metals drag

Most major sectoral indices ended the session in the red, with Nifty Metal emerging as the top laggard, dropping 0.83%. Ten out of the 15 constituents of the index closed in negative territory, with Vedanta being the top loser as the stock tumbled 2.4% after it traded ex-dividend.

In an exchange filing on December 16, the company announced that the board had approved the fourth interim dividend of ₹8.50 per equity share at a face value of Re 1, amounting to ₹3,324 crore.

Other top laggards in the metal pack included National Aluminium, APL Apollo Tubes, SAIL, JSW Steel, Hindalco Industries, and Ratnamani Metals & Tubes, all of which lost between 1% and 2% during the session.

Nifty PSU Bank also ended the session with a 0.56% cut, followed by Nifty IT, Nifty Media, Nifty Consumer Durables, Nifty Energy, and Nifty Realty, all closing with losses ranging from 0.08% to 0.56%.

In contrast, Nifty Auto stocks managed to close in the green with a gain of 0.57%. Similarly, Nifty Oil & Gas and Nifty FMCG wrapped up the session with gains of 0.54% each.

Commenting on today's market performance Vinod Nair, Head of Research, Geojit Financial Services said, “The domestic market concluded flat ahead of the holiday, with metal and power stocks dragging performance while FMCG and auto sectors gained from recent corrections. The near-term market trajectory hinges on the outcome of Q3 results and the Union budget, but caution prevails due to a strong dollar, high bond yields, and concerns over rate cuts. The INR hitting an all-time low further evoked the caution.”

Nifty 50: Key levels and trends

Rupak De, Senior Technical Analyst, LKP Securities said, "The Nifty remained mostly rangebound throughout the day before closing flat. On the daily chart, the index closed below the 200-DMA for the first time in three days, confirming a short-term bearish trend. The RSI is in a bearish crossover and continues to decline, reinforcing the negative outlook. On the downside, support is placed at the 23,500-23,400 zone, while resistance is seen at 23,860."

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions