Indian shares snap winning run as investors book profits; earnings in focus

Indian share benchmarks snapped a four-session rally on Tuesday, as broad-based profit-taking overrode a rebound in IT companies, while investors watched for fresh triggers from the upcoming earnings season.

Shares were largely positive through the day, consolidating gains from mostly upbeat pre-quarterly results updates and lower crude prices. The monsoon’s steady progress across the country and the return of foreign inflows also aided sentiment.

The benchmark Nifty 50 fell in the 30 minutes before close to end 0.13% lower at 24,398.70, while the BSE Sensex dropped 0.13% to 78,180.72, after rising 2.4% each over the last four sessions.

Both indexes traded near 10-week highs hit in the previous session.

“While the near-term outlook remains neutral to positive, the market requires a decisive breakout above the multi-month resistance zone of 24,500-24,600 to generate fresh bullish momentum,” said analysts led by Rajesh Palviya of Axis Securities.

The ongoing consolidation indicates major demand zones amid minor downward moves, suggesting a strong buying interest on dips, according to Axis Securities.

Foreign portfolio investors turned buyers in the last three consecutive sessions, according to NSE’s provisional data, while Brent crude prices held near pre-Iran war levels.

The heavyweight IT index rose 2.4%, extending its July rebound to 6.2%, as U.S. rate-hike bets remained lower than before.

India’s top IT services company Tata Consultancy Services will kick off quarterly earnings on Thursday.

Heavyweight Reliance Industries dropped 1% after a two-session rise, while ICICI Bank fell 0.9%, snapping a four-session winning run.

Fashion retailer Trent plunged 12.4% after reporting softer-than-expected standalone revenue growth for the June quarter.

Twelve of the 16 major sectors logged losses. The broader small-caps and mid-caps fell about 0.6% and 0.3%, respectively.

Among other stocks, Titan gained 2.7% after reporting a 41% growth in consumer business in the first quarter.