What’s dragging Nifty, Sensex down 1% today- Infosys, IT stocks fall; what next for benchmark indices

What’s dragging Nifty, Sensex down 1% today: Infosys, IT stocks fall; what next for benchmark indices

NSE Nifty 50 and BSE Sensex tanked over 1% today dragged by Infosys and other IT stocks and weak global market sentiment. The Nifty 50 sank 1.08% or 216 points to 19,979.15 and BSE Sensex plunged 1.2% or 816 points to 66,755.66. Nifty IT tumbled 4.6% or 1,444 points to 29,701.20. Infosys was the biggest loser on both Nifty 50 and 30-share Sensex, falling 10% after disappointing Q1 results and reduced guidance. The 2% fall in the tech-heavy Nasdaq index overnight after Netflix and Tesla results missed market estimates also dragged the domestic IT index down. The top losers on Nifty 50 were Infosys, Reliance Industries Ltd (RIL), Hindustan Unilever Ltd (HUL), HCL Tech and Wipro while the gainers were Larsen & Toubro, JSW Steel, SBIN, Adani Enterprises and Divis Laboratories.Strong economic fundamentals, macroeconomic indicators continue to support bullish trend

“The 1% dip in the Nifty appears to be a reaction to a combination of disappointing Q1 earnings from key companies such as Infosys, the demerger of Reliance Industries and negative global cues, notably the Nasdaq’s biggest loss of the year influenced by Netflix and Tesla’s earnings reports. Looking forward, despite this temporary setback, the overall market outlook remains positive. Strong economic fundamentals, macroeconomic indicators, and broad-based growth continue to support a bullish long-term trend,” said Sonam Srivastava, Founder and CEO at Wright Research.

Nifty support at 19600-19500; resistance at 19800-19900

“The pattern analysis on Nifty 50’s daily timeframe and based on the derivative data, the zone of 19600-19500 holds a stronger support zone and we reckon the drawdown to be limited to this zone whereas on the upside the zone of 19800-19900 is anticipated to act as immediate resistance zone,” said Riches Vanara, Technical And Derivatives Analyst, Stoxbox.

Nifty 19700-19600 likely to cushion any blip; refrain from creating short positions

“Nifty undertone is strongly bullish, one may refrain from creating shorts at this point in time. The pragmatic approach would be to take some money off the table from aggressive bullish bets. As far as levels are concerned, 19700-19600 is likely to cushion any blip, while strong support lies around the 19500 zone. On the higher end, the 20K mark is likely to act as a sturdy wall in the comparable period,” said Osho Krishan, Sr. Analyst – Technical & Derivative Research, Angel One Ltd.