Indian Stock Market Opens Higher, HCLTech Shares Tank 9%
The domestic benchmark indices opened higher on Tuesday, although shares of HCLTech tanked by 9 percent in early trade following the release of disappointing Q3 results that failed to meet broker expectations.
Mumbai: The domestic benchmark indices opened higher on Tuesday, although shares of HCLTech tanked by 9 percent in early trade following the release of disappointing Q3 results that failed to meet broker expectations.
HCLTech’s Stock Down 9% After Q3 Results
Brokerage firm Nuvama downgraded HCLTech‘s stock rating from “buy” to “hold” after the company posted its quarterly results. This downgrade contributed to the significant drop in the tech giant’s stock price.
Market Overview: Nifty 50 and Sensex Open Higher
Despite HCLTech’s poor performance, the broader market opened on a positive note. At 9:16 a.m., the Nifty 50 was up by 113.60 points, or 0.49%, at 23,199.55, and the Sensex gained 370.21 points, or 0.49%, to reach 76,700.22.
Market Correction and Valuations
Market experts have pointed out that the broader market may be overpriced and could face a sharp correction. There is also a reversion to mean valuations taking place in large caps. Factors like a strengthening dollar, rising US bond yields above 4.7%, and political uncertainty surrounding Donald Trump’s post-January 20 actions are contributing to the market’s volatility.
The Nifty saw a 1.5% decline on Monday, marking the fourth consecutive day of losses and the sixth decline in the last seven sessions.
Technical Outlook: Support Levels and Potential Bounce Back
“Technically speaking, the 22,830-23,000 range is notable support, with some near-term time cycles expected to converge between January 17 and 23,” said Akshay Chinchalkar, Head of Research at Axis Securities.
He also noted that the market appears oversold, which may result in a short-term bounce back. However, this recovery may not be sustained, especially in mid and small caps. Experts recommend that retail investors consider purchasing quality large-cap stocks that are currently undervalued.
Also Read: HCLTech Reports 5.5% Net Income Growth at Rs 4,591 Crore in Q3 FY25
Foreign Institutional and Domestic Investment Activity
Foreign institutional investors (FIIs) sold equities worth Rs 4,892.84 crore on January 13, while domestic institutional investors (DIIs) bought equities worth Rs 8,066 crore on the same day.
Caution Advised Amid Market Volatility
Given the prevailing market volatility, traders are advised to exercise caution. “Implement strict stop-loss measures and avoid carrying long positions overnight to manage risk effectively,” said Hardik Matalia from Choice Broking.
