After opening in the negative territory, the domestic equity market recovered a bit but was still trading around half a per cent lower. The S&P BSE Sensex traded over 300 points lower at 61,446.19 levels while the NSE's Nifty quoted at 18,176.45, down 79 points. 

"The most significant trend in the market now is India’s outperformance even in the context of the challenging global environment. The mother market US has turned weak and S&P 500 has slipped for the fourth day on renewed fears of the stress in the US banking system. But the Nifty, defying weak global cues, is resilient and is only 3.5 per cent away from the all-time high. Sustained FII buying of Rs 10,900 crores during the last six trading sessions aided by the appreciating rupee and India’s improving macros is the prime driver of this rally. Improving corporate earnings as reflected in the Q4 numbers also emboldened the bulls," said  Dr V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

A market correction is imminent. It would be a good idea to take some money off the table even while continuing with the Buy on Dips strategy, the market analyst added.

Among buzzing stocks, index heavyweights HDFC Bank and HDFC corrected over 5 per cent after MSCI, in its note to clients, said it will use an adjustment factor of 0.50 to compute HDFC merged company weightage. The decision is expected to trigger selling to the tune of $150-200 million in HDFCBank. Besides, Manappuram Finance hit a 10 per cent lower circuit after the Enforcement Directorate (ED) on Thursday (May 4, 2023) said it recently conducted searches at six premises in Thrissur, Kerala, belonging to Manappuram Finance Limited and its Managing Director VP Nandakumar and froze Rs 143 crore lying in various accounts.

Mid, small-cap stocks

The broader market was performing better than the blue-chip stocks. The S&P BSE MidCap index traded 0.17 per cent higher at 26,026.88 levels while the S&P BSE SmallCap index was up 0.18 per cent.