Sensex, Nifty End Lower; Banking Stocks Play Spoilsport

Sectorally, BSE bankex, finance, metal, energy, realty and utilities indices fell up to 1.51 per cent. While consumer durables, IT, teck, capital goods, industrials and auto indices rose up to 3.37 per cent.

Broader midcap and smallcap indices outperformed the BSE benchmark, ending up to 0.74 per cent higher. “Markets exhibited volatility and ended flat for the day, switching between gains and losses. However, global markets, especially Europe, were generally positive for the day, anticipating better economic data, Vinod Nair, Head of Research at Geojit Financial Services, said.

Domestically, data emerged that the services sector had contracted for the 6th consecutive month, in spite of phased reopening of the economy in the last two months, he said, adding that this has led to worries that the comeback, foreseen for the economy, could be long drawn out. The market turned negative after the latest IHS Markit Services Purchasing Managers’ Index (PMI) contracted for the sixth successive month in August.

The seasonally adjusted India Services Business Activity Index rose sharply from 34.2 in July to 41.8 in August, the highest since March, before the escalation of the pandemic. The downturn in India’s services sector activity eased in August but remained in the contraction zone as COVID-19 pandemic-induced restrictions continued to adversely impact client demand and business operations.