Market Update: Nifty slips below 17,200, Sensex dips over 1100 points; financial services, FMCG among top losers

Domestic equity markets declined nearly 2 per cent in the afternoon trade on Monday, a day before the re-scheduled Reserve Bank of India's monetary Policy Committee meeting on Tuesday. The meeting slated to take place on Monday was deferred to Tuesday after Maharashtra government declared public holiday on February 7 to mourn the death of legendary singer Lata Mangeshkar. The indices corrected amid weaker global cues and FIIs selling pressure as they also reacted to muted Q3 earnings.  

The broader Nifty50 touched the day's low of 17,175.55 as the index declined nearly 2 per cent or over 300 points in the afternoon trade. The S&P BSE Sensex corrected by over 1000 points to touch day's low of 57,490.19 amid volatility in the market.  

Also Read: 5 factors that explain the weakness

In the broader market small cap index took the maximum thrashing as the index declined over 1.5 per cent. Financial services, FMCG and banking stocks declined the most as the related indices corrected between 1.5 to 2 per cent on Monday. Nifty PSU Bank was top performer with about 1.5% gain in an otherwise negative market.  

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HDFC LIfe, HDFC Bank, SBI Life, L&T, Titan, Bajaj Finance, Bajaj Finserv, Hindustan Unilever, Bharti Airtel and Kotak Bank were among those which dragged the market the most.   

Tata Steel, ONGC, PowerGrid, NTPC, Coal India, State Bank, tech Mahindra and Ultratech Cement traded in the green.  

FIIs selling can be the biggest trigger: Santosh Meena, Head of Research, Swastika Investmart Ltd

Santosh Meena, Head of Research, Swastika Investmart Ltd, said Indian market has been witnessing a sharp cut in today's trading session and this weakness can be attributed to heavy selling by FIIs amid rising US bond yields and crude oil prices. "If we look at the profile of the stocks then there is a sharp cut in FIIs' favorite names such as HDFC twins, ICICI Bank, Infosys, Kotak Bank, Reliance, etc. We can expect large FIIs' selling figure in today's trading session, however, there is a good buying in PSU banks, metal stocks and sugar stocks where earnings were strong," he said. 

He said in terms of domestic cues, budget was good and earnings' momentum is strong but the important question: "is the market looking nervous ahead of state elections?"   

"Technically, Nifty has slipped below its 50-DMA which is not a good sign, however, 17200 is a support level where we can expect some recovery otherwise selling pressure may get momentum towards 17000/16800 levels. On the upside, 17450-17500 will act as a strong resistance now," Meena added 

Meanwhile, Leading depository CDSL on Monday reported a 55 per cent jump in consolidated net profit to Rs 83.63 crore for the three months ended December 31. 

It had posted a net profit of Rs 54.03 crore in the same quarter of the preceding fiscal, Central Depository Services (India) Limited (CDSL) said in a statement. 

The company's total income rose 58 per cent to Rs 162.93 crore in the quarter under review, from Rs 103.2 crore in the year-ago period.