Sensex closes lower; banks, IT, metals drag, pharma rallies

The Sensex closed lower on the first day of October series, after seeing consolidation throughout the session. Fall in technology, banking, telecom and metal companies' shares kept the markets nervous through the day. However, pharma and oil & gas stocks bucked the trend and remained supportive to the benchmark indices.

Dipan Mehta, Member of BSE/NSE said uptrend was showing signs of fatigue, so the markets would consolidate at current levels. "The kind of selling which comes around 5000 level seems to suggest that maybe this sideways to slightly declining trend would be more perceptible going forward. One would get a clear-cut direction sometime around middle of October when we are just about entering the earnings season. But for the time being, the markets will consolidate at these levels and maybe in the immediate short-term you could see them correcting given that we have not seen any spectacular move above from these levels."

The 30-share BSE Sensex closed at 16,693, down 88.43 points or 0.53%, after seeing day's high/low of 16,812.02 and 16,613.22. The 50-share NSE Nifty was down 0.55% or 27.60 points, to settle at 4958.95, after trading in a range of 4931.25-4994.35.

Global cues were also a bit of on the negative side. Asian markets closed lower; Nikkei lost 2.6%. Jakarta fell 1% and Shanghai down 0.53%. Hang Seng, Straits Times and Kospi were marginally down while Taiwan gained 0.3%. The US markets were down on Thursday, after disappointing existing home sales data and crude fall another 4% for second day running. However, European markets and US index futures were flat, at the time of closing of Indian equities.

The broader indices outperformed the equity benchmarks and gained 0.6%-0.9%, as market breadth remained positive. About 1,678 shares advanced while 1,199 shares declined on the BSE. Nearly 330 shares remained unchanged.

In the midcap space, National Fertilisers shot up 17.65%. JM Financial, GTL Infra, Aurobindo Pharma and IDBI Bank gained 8-10% while JSW Steel, Welspun Gujarat, Info Edge, Parsvnath and MRF fell 3-4%.