The stock market witnessed a significant downturn today, with investors disappointed by TCS's weak quarterly results. The Nifty closed below the 25,150 level.
The stock market cautiously began trading on Friday, but as the day progressed, the decline gained momentum. The Nifty and Sensex both attempted a slight recovery in morning trading, but TCS's poor quarterly results shook investor confidence, causing the market to slide downwards. After a day of trading, the Nifty closed at 25,149.85, down 205 points, while the Sensex closed at 82,500.47, down 690 points.
TCS's weak report spoils the picture
Tata Consultancy Services (TCS), a leading company in the IT sector, reported weaker-than-expected quarterly results. The company's reports on profits and deals disappointed the market. Investors were already apprehensive about the IT sector, but after the results were announced, it became clear that the first quarter would not be as b as anticipated.
What levels are now in focus
From a technical perspective, the 25,050 level is now considered the next support for the Nifty. If this level breaks, the market could fall to 24,800 and then to 24,500. On the upside, 25,300 and 25,350 have now become resistance levels. The situation of Bank Nifty is slightly better, but weakness could increase if it falls below 56,500. The next major support in Bank Nifty is seen at 56,000, while its resistance is at 57,000.
IT sector hit the hardest
The IT sector proved to be the weakest in today's trading. A decline of nearly 2 percent was recorded in this sector. The TCS report further pushed this sector, which was already under pressure before the results. On the other hand, defensive sectors like Pharma and FMCG showed some stability, but they could not sustain the market.
The market's recent rally now at risk
The recent rally seen in the market now appears to be at risk. The Nifty's rally, which started from around 24,700, is now on the verge of breaking. If the results are worse in the coming trading sessions, then a further decline in the market cannot be ruled out.
Why the importance of first-quarter results has increased now
Anuj Singhal believes that today's decline is mainly due to the results, so the results of other companies will now be viewed more seriously. Rohit Sekseria, Equity Fund Manager at Sundaram Mutual Fund, also believes that the market has already rallied based on expectations, but now reality is starting to emerge.
He says that there is certainly hope for improvement in economic activities from the steps of the Reserve Bank and the government, but it will take time for its impact to be visible. For now, the market will take direction based on the first-quarter results.
Investors' eyes on IT and banking companies
Market activity may intensify next week as the results of several major IT and banking companies are due. These include giants like Infosys, HDFC Bank, Kotak Mahindra Bank, Wipro, and Axis Bank. The results of these companies will determine whether the market will recover from the recent decline or fall further.
Today's complete overview at a glance
- Nifty closed at 25,149.85, down 205 points
- Sensex closed at 82,500.47, down 690 points
- Bank Nifty fell 0.35 percent, below 56,800
- IT index down nearly 2 percent
- Smallcap 100 down more than 1 percent
- Midcap 100 down nearly 1 percent
