BENGALURU: Indian blue-chip stocks dropped for a third straight day on Tuesday, while mid-cap stocks snapped an 11-session rally, pulled down by profit-taking in another volatile session.
The blue-chip NSE Nifty 50 closed 0.2% lower at 22,888.15 points, while the S&P BSE Sensex declined 0.3% to 75,170.45.
The more domestically-focussed mid-caps and small-cap ended about 0.9% lower each, with the latter posting its biggest one-day drop in over two weeks.
Both the blue-chips and their smaller peers have hit record highs over the month, with the mid-cap index’s all-time high recorded in the previous session.
“Mid-caps and small-caps are very stretched in terms of valuation. There is some profit booking in some of the leading names,” said Samrat Dasgupta, CEO at Esquire Capital Investment Advisors.
The Nifty volatility is near two-year highs due to nerves about the outcome of the ongoing general elections that end on Saturday.
While Prime Minister Narendra Modi’s Bharatiya Janata Party is expected to return to power, there is some uncertainty over the margin of victory.
Traders are positioning their portfolios slightly more defensively with names that have not participated in the recent run-up as they anticipate national general election results, Dasgupta said.
Among sectors, energy fared the worst, sliding by 1.2%, while banks closed 0.3% lower.
Adani Green and Adani Energy dropped 1.9% and 1.5%, respectively, the most among energy stocks.
The few gainers included Sumitomo Chemical India, which climbed 9%, and 3M India, which ended 10% higher, both after posting upbeat quarterly results.
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