Sensex drops below 49K on profit taking

The market continued to be volatile ahead of the Union Budget with investors taking profit home after the benchmark indices surged earlier this week to new all-time high.

The Sensex closed 746 points, or 1.5 per cent down, at 48878, a day after it hit the 50000 mark.

The Nifty-50 closed at 14371.90, down by 218.45 points, or 1.5 per cent. The BSE Mid-cap Index fell 1.19 per cent and the BSE Small-cap, 1.04 per cent.

Foreign portfolio investors turned net sellers by Rs 635.59 crore while the domestic institutions were net sellers by Rs 1,290.35 crore.

"We are seeing some kind of profit booking at higher levels as the Sensex touched the psychological mark of 50,000 this week. The persisting rise in (Covid-19) cases has intensified restrictions in parts of Europe, UK and Hong Kong which is impacting global markets," said Rusmik Oza, head of Fundamental Research, Kotak Securities.

The market is speculating about a Covid Tax in the Union Budget.

Global cues were also not favourable. A slowdown in eurozone business activity accelerated in January, making a new recession almost certain as the Covid-19 pandemic continues to batter the economy.

“A double-dip recession for the eurozone economy is looking increasingly inevitable as tighter Covid19 restrictions took a further toll on businesses in January,” Chris Williamson, chief business economist at IHS Markit, said.

Bajaj Auto and Tata Motors were the biggest gainers in Nifty-50 this week, with up-move of 14 per cent and 11 per cent, respectively.

Reliance Industries gained 6 per cent this week. PSU and metal stocks were the biggest losers this week. Amongst PSUs, ONGC and Coal India are down 8.6 per cent and 7 per cent, respectively. Profit booking has led to correction in Tata Steel (-8.5 per cent) and Hindalco (-5.8 per cent), Oza said.

Indigo Paints IPO subscription stood at more than 117 times on the final day’of the public bidding process.

As per the last update, the public offer was subscribed 189.57 times by the qualified institutional buyers, 263.05 times by non-institutional or high net worth investors and 15.93 times by retail individual investors.

Indigo Paints’ Rs 1,170 crore public issue was priced at Rs 1,488 to Rs 1,490 per equity share of Rs 10 face value.

Sequoia Capital backed Indigo Paints raised Rs 348 crore from 25 anchor investors on January 19.

The Pune-based firm manufactures a range of decorative paints and has an extensive distribution network across India.