Stock market update: Nifty around 17k, Sensex down 800 points as indices marginally recover; ONGC, Hindalco gain in falling market

The apprehension over likely Russia-Ukraine war continues to drive sentiments on Dalal Street as the domestic market has been reacting sharply to any development related to the geopolitical tension.  

As Russian President Vladimir Putin on Monday recognised two separatist regions in eastern Ukraine as independent, hinting at the impending war, the domestic equity benchmarks Nifty50 and the Sensex corrected 2 per cent in the early trade as all broader market and sectoral indices were seen deep in the red.  

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At 11am, the Nifty50 declined by 232 points or 1.35% to trade at 16,974.50, while the Sensex dropped 804 points or 1.39% to 56,879.61. Though Nifty reclaimed 17000 briefly, but the index continues to slip below the crucial level.  

Technically, Nifty is trying to respect its 200-DMA which is currently placed around 16,850, but if Nifty starts to trade below 200-DMA, then correction may see further extension towards 16000/15500 levels, said Nyati. On the upside, 17300/17500 are important resistance levels; above this, we can expect positive momentum in the market," said Parth Nyati, Founder, Tradingo. 

Meanwhile, India VIX index shot up 16% as all broader market indices traded lower around the same time. Among Sectoral indices, media, metal, PSU Bank and IT were seen struggling the most.  

TCS, BPLC, UPL, Tata Steel, Adani Ports, Dr Reddy's, Bharti Airtel, and State Bank of India were top losers as all stocks remained in the red on the 30-share Sensex.  

Three shares—Hindalco, ONGC, Eicher Motors —  advanced on the Nifty 50 and remaining 47 declined.  

Nyati said the market witnessed a sharp cut in early trade on the back of intense geopolitical tension. "We are in monthly F&O expiry week therefore we could see a surge in volatility, whereas March is going to be a very volatile month due to geopolitical uncertainty, results of state elections, US Fed meeting, etc. The overall trend is bullish, but we may have high volatility over the next month.  

Capital goods, infra, realty, banking among top bets in this correction 

He suggested short-term traders remain light, while he advised long-term investors to look at this correction as a buying opportunity. "We are very bullish on capital goods, infrastructure, real estate, banking, consumer goods, and auto ancillaries' space. We advise investors to look for buying opportunities in these areas," he said. 

"Do not rush into buying"  

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services is of the view that buying opportunities may emerge in this correction, but investors need not rush-in to buy. "The situation is fluid. FIIs are likely to continue selling. This will continue to depress the prices of some high-quality financials. Nibbling in this segment can be considered," he added.