After hitting new peaks in early trade, the benchmark indices wiped off all gains amid profit taking at higher levels. The BSE Sensex was down 6 points at 55,700 levels. The index scaled new all-time high of 56,099 in trade earlier.
Sensex Erases 300-Point Gain
Nifty, meanwhile, slipped below 16,600 mark. It had hit a new high of 16,700 in trade. ICICI Bank, Kotak Bank and HDFC along with Infosys and RIL were the top Sensex drags. On the other hand, gains in HDFC Bank, Bajaj twins and Ultratech Cement capped downside.
In the broader markets, BSE Midcap was up 0.2 per cent and BSE Smallcap was down 0.25 per cent. Large caps are playing a catch-up rally in the month of August, driving the benchmark indices to higher levels, while the broader market is in a consolidation zone.
Mid caps and small caps have seen a sharp rally in the last few months and now some profit booking is visible in the space which is a healthy sign for the market. Investors are now finding comfort in the large cap space which provides more margin of safety over the broader market at current levels.
We continue to see the broader market doing well, so any dips should be utilized to build positions in quality stocks where the earnings visibility and the balance sheet strength is very high. Returns from current levels will be more calibrated and focus on quality and value will yield sustainable returns.