Short-term formation on Sensex still weaker

Mumbai: Profit booking continued at higher level, the benchmark index Sensex was down by 153 points. Among Sectors, profit booking was seen in Oil and Gas stocks whereas some buying interest was seen in selective reality stocks. Technically, after a sharp decline, the index is consolidating with the range of 52,600-53,000.

"The short term formation is still on the weak side. And we are of the view that, if the index slip below the level of 52,600 it could hit the level of 52,300-52,100," says Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. On the flip side, 53,000 would act as an immediate hurdle for the bulls. Above which it could move up to 53,300-53,500.

Prashanth Tapse, Vice President (Research), Mehta Equities said: "Amidst volatility, the markets mostly traded in red and the negativity can be attributed to a bleeding Wall Street, as rising inflation has bolstered expectations that the Federal Reserve will continue to aggressively hike rates in the second half of this year, even with signs of economic slowdown. Meanwhile, the US bond markets are just flashing a recession as the yield on the 10-year US Treasury briefly fell below that of the 2-year note in Monday trading, in what is known as a yield curve inversion." The streets' sentiment now primarily hinges on the FOMC policy outcome later this week, he added.