Closing Bell: Market ends 6-day winning streak as Nifty, Sensex decline half per cent amid volatility; Metal stocks shine

Snapping a six-day winning streak, the Indian market closed in the red on Monday. Amid volatility due to Q1 earnings, profit booking in Nifty heavyweight Reliance Industries and anticipating aggressive rate hike by the US Federal Reserve in FOMC meeting on July 27, the benchmarks ended with around half per cent cut each. The broader Nifty 50 declined around 0.55% to end near 16,300 and the Sensex dropped around 300 points to close above 55,750.

"The Nifty index after a 600 points rally witnessed profit booking at higher levels. The index will likely consolidate in the range of 16,400-16,800 ahead of the US FED meet. The trend remains on the upside and one should keep a buy-on-dip approach," said Kunal Shah, Senior Technical Analyst at LKP Securities. 

Following the benchmark indices, the Nifty Midcap index closed lower by 0.10% and Nifty Smallcap declined almost 0.60% on Monday.  

Meanwhile, speaking about the today's correction, Vinod Nair, Head of Research at Geojit Financial Services, said fears of global economic slowdown along with the reaction to a slew of major quarterly earnings dictated the trend in the domestic market.

"Recession fears are casting a shadow over the global markets as US and Euro business activity contracted unexpectedly owing to the downturn in manufacturing and service sectors. The major market driver this week will be the Fed’s policy decision on Wednesday, where it is expected to hike rates by 75bps," he added. 

On the sectoral front, Nifty Metal gained around 1.4%, while IT index attracted some buying interest in the closing hours, however, all other Nifty sectoral indices ended in the red.  

The drag was led by profit booking in large cap stocks, such as Reliance Industries, Mahindra & Mahindra, Maruti, Eicher Motors, ONGC, Kotak Bank, Nestle India and Tech Mahindra.  

Tata Steel, ahead of stock split, IndusInd Bank, post strong q1 numbers, Coal India, Apollo Hospitals, Hindalco, NTPC, Wipro, HCL Tech and L&T provided much needed support to the market amid volatility.