Assembly election results for Maharashtra and Haryana also were not as per market expectations with Haryana’s hung assembly verdict.
The market continued to be volatile in the busy earnings season; on Thursday Supreme Court order on telecom companies license and spectrum usage charges to be paid to the government led to higher volatility as telecom stocks fell sharply. Assembly election results for Maharashtra and Haryana also were not as per market expectations with Haryana’s hung assembly verdict.
The Sensex closed nearly flat at 39,020.39, down 38.44 points or 0.10 per cent, in a volatile trading session, the index touched an intra-day high of 39,327.15 after opening in the green but later touched a low of 38,840.76.
Telecom major Bharti Airtel fell close to 10 per cent intra-day, but recovered later posting more than 3 per cent gain. Infosys also fell in the last hour of trade closing 2.36 per cent down at Rs 635.40 on the BSE as both Indian and US market regulators have begun probe in the whistle blower matter.
Bharti and Vodafone Idea’s overdue licence fee stands at Rs 6,800 crore each. Including the interest and penalty, the total outstanding amount for all the companies is Rs 92,600 crore. The decision comes as a major steback to the incumbent telecom companies as it implies higher payments when the industry is facing price-war and intense competition, analysts said.
Nifty-50 index closed at 11,582.60 down 21.50 points or 0.19 per cent.
The sectoral indices closed mixed the losers included BSE Bankex(-1.16 per cent), Power (-1.24 per cent), IT (-0.71 per cent), Telecom(-0.67 per cent), Auto (-0.32 per cent).
The market didn’t get much support from either domestic the institutions who were net sellers of equities worth Rs 738.75 crore or the foreign portfolio investors also were net sellers by Rs 72.87 crore.
Shrikant Chouhan, senior vice-president- Equity Technical Research, Kotak Securities said, “Mixed news flow on the domestic front kept the market volatile throughout the day. Supreme court’s verdict for telecom carrier to pay past dues of $13 billion has shaken the telecom companies, as well as their lenders like private and public banks. Also, assembly elections results were little below expectations that has increased short term nervousness in the market.”
“However, the market is preparing for a major trending move and such type of negative news flow offers buying opportunity for those who have missed the opportunity at lower levels. Techni-cally, we are of the view that the market is consolidating between the range of 11,720 and 11,470 to surpass its resistance level of 11,720 decisively,” Chouhan said.
Vinod Nair, Head of Research, Geojit Financial Services said, “Market has been flattish during the week assessing the ongoing Q2 result which is marginally better than expected till date. Given the trading holiday, volume has reduced taking a conservative approach. Going forward weak crude oil prices, positive global sentiments and further reforms from the government are expected to provide positive momentum."