Nifty Succumbs to Selling Pressure, Erodes Early Gains

At the close, the Nifty 50 was at 18,129.95 down by 0.28%

Today, the NSE Nifty 50 commenced on a buoyant note, scaling lofty heights, only to experience a subsequent decline of 0.28 percent before culminating in the unfavorable territory of the market spectrum. Consequently, the index concluded below the significant threshold of 18150.

The Nifty commenced with a gap-up opening; however, it struggled to maintain its upward trajectory and concluded the session with a negative movement, declining by approximately 50 points. Analyzing the hourly charts, it becomes evident that the Nifty encountered resistance in proximity to significant hourly moving averages, subsequently succumbing to selling pressure.

In the realm of sectorial performance, the financial services sector emerged as a frontrunner, with a substantial gain of 0.32%. Noteworthy contributors to this surge include Cholamandalam Investment and Finance Company Limited, which registered a commendable increase of 3.20%. Similarly, Bajaj Finance Limited recorded a respectable gain of 1.27%, while Kotak Bank Limited showcased a commendable uptick of 0.93%.

Conversely, the realty sector experienced a downward trend, with an overall decline of 2.37%. Among the key constituents, Godrej Properties Limited faced a notable setback, witnessing a substantial loss of 5.62%. Brigade Enterprises Limited also endured a downturn, with a decline of 3.27%, while Sobha Limited experienced a decline of 3.15%.

Bank Nifty: Up by 0.12%

The Bank Nifty initiated the trading session on a positive trajectory, exhibiting a gain of 0.12 percent, and ultimately sealed its fate in the favorable green zone, reaching a commendable mark of 43,752.30. In contrast, the BSE Sensex encountered a slight setback, declining by 0.21 percent and concluding the day in the unfavorable red territory, with a noteworthy nadir of 61,431.74.

On the third day of profit taking, domestic markets exhibited weaker performance compared to their Asian counterparts. Investors, driven by a risk-on sentiment resulting from a notable surge in valuations, opted for cautious positions. However, a sense of bearishness prevailed due to concerns surrounding the US debt-ceiling deal and indications of sluggish demand in China.

From a technical standpoint, the Nifty displayed a formation of lower top on intraday charts, coupled with the presence of a bearish candle on the daily charts, reflecting a predominantly negative outlook.

Encouraging progress in the debt-ceiling negotiations in the United States reverberated across global markets, instilling a sense of optimism. However, the domestic market sentiment faltered during the latter part of the day, primarily due to the varied earnings results announced by prominent sector players. Notably, India’s VIX, at lower levels, signals a stable market environment, fostering investor confidence and promoting a conducive atmosphere for long-term investments.

On 18th May 2023, Foreign Institutional Investors/Foreign Portfolio Investors (FII/FPI) engaged in market activities with a buy value of 7,731.46 crore and a sale value of 6,761.28 crore, resulting in a net value of 970.18 crore (in Indian Rupees).

Similarly, Domestic Institutional Investors (DII) participated in the market on the same date, reporting a buy value of 4,830.85 crore and a sale value of 5,680.81 crore. Consequently, the net value stood at -849.96 crore (in Indian Rupees).

Bank Nifty

The Nifty Banking sector had some gainers and some losers for the day.

The gainers included AU Bank with a 2.62% increase, Kotak Bank with a 0.93% increase, ICICI Bank with a 0.76% increase, HDFC Bank with a 0.37% increase, and Bandhan Bank with a 0.21% increase. On the other hand, the biggest losers in the sector included Bank of Baroda with a 3.04% decline, State Bank of India with a 1.70% decline, Punjab National Bank with a 1.62% decline, Federal Bank with a 0.63% decline, and IDFC First Bank with a 0.45% decline. These results suggest that some banking stocks performed better for the day.

Buzzing

Bajaj Finance Ltd. witnessed an upward movement in its share price, surging by 1.26% from its previous closing value of Rs 6,705.05. The latest traded price for Bajaj Finance Ltd. stock stands at Rs 6,789.40. Notably, the stock has yielded an impressive three-year return of 245.87%, outperforming the Nifty 100 index’s return of 94.86%. Moreover, the company recently declared a dividend of Rs 30.0 per share, slated for distribution on 26th April 2023, with a record date of 30th June 2023.

The performance of the new iteration of its super app is a crucial factor to observe, as it facilitates customer acquisition and enhances risk management. The digital metrics will play a pivotal role in sustaining the company’s elevated valuations.

Bharti Airtel Ltd. The share price of Bharti Airtel Ltd. experienced an upward movement, exhibiting a rise of 0.90% compared to its previous closing value of Rs 792.25. The most recent traded price for Bharti Airtel Ltd. stock stands at Rs 799.35. Notably, a 10-day moving crossover materialized yesterday, a technical indicator worth noting. Historical data reveals an average price gain of 3.36% within seven days following this signal over the past five years.

The company’s annual revenue growth stands at an impressive 21.22%, outperforming its three-year compound annual growth rate (CAGR) of 15.42%. However, it is worth mentioning that Bharti Airtel Ltd. reported a negative return on equity (ROE) for three consecutive years, which warrants careful consideration.

Buzz

On Wednesday, Orchid Pharma disclosed that the stock exchanges have initiated the process of freezing the shares held by its promoters due to the company’s non-compliance with SEBI’s prescribed timeframe for achieving the minimum public shareholding norms. Orchid Pharma affirmed that it had taken proactive measures to ensure a minimum public shareholding of 25% of the total shareholding. As part of this effort, its promoter entity, Dhanuka Laboratories, executed an offer for sale, divesting 8.04% of the equity shareholding in 2021. Consequently, the promoter’s ownership stake reached 89.96% of the equity shares, resulting in the public shareholding standing at 10.04% within 18 months from the acquisition date.

Advance Decline Ratio

Today, the advance-decline ratio was 0.68, and the market breadth was negative. The volatility index India Vix decreased by 2.36 percent to settle at 12.80 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 913
Decliners – 1351
52Wk High –  86
52Wk Low – 15
High Band Hitters – 59
Low Band Hitters – 32
200d SMA – 17777
50d SMA – 17648
20d SMA – 18079

Top Gainers and Losers Stocks

The top gainers were Bajaj Finance (+1.27%), Bharti Airtel (+0.98%), Kotak Bank (+0.93%), ICICI Bank (+0.76%), and HCL Technologies (+0.58%).

The top losers were Divi’s Laboratories (-3.24%), Adani Ports (-2.93%), ITC (-2.05%), SBIN (-1.70%), and Power Grid (-1.59%).

Top Gainers and Losers Sector

The top gainers sectors were Financial Services (+0.32%).

The top losers sectors were Realty (-2.37%), Pharma (-1.27%), FMCG (-1.10%), Oil & Gas (-1.10%), and Auto (-0.88%).

The Nifty Midcap 50 was down by 0.74 percent, while the Nifty Small Cap 50 was down by 0.61 percent on the day.

The Nifty Midcap 50 index currently closed at 9,176.55, while the Nifty Small Cap 50 index currently closed at 4,465.55.

SECTORS – NOTABLE ACTION
FINANCIAL SERVICES +0.32%
REALTY -2.37%
PHARMA -1.27%
FMCG -1.10%

Stocks Ban List

(SEBI) F&O ban list  (LICHSGFIN open at -373.00 and close at -365.80), (MANAPPURAM open at -112.25 and close at -111.20), (GNFC open at +659.00 and close at -602.35), (ABFRL open at -196.00 and close at -193.70), (BALRAMCHIN open at +383.45 and close at +384.60), (DELTACORP open at -227.00 and close at -222.05), and (PNB open at +49.60 and close at -48.45), are not currently on the stock exchange.

The Securities and Exchange Board of India (SEBI) has banned LICHSGFIN, MANAPPURAM, GNFC, ABFRL, BALRAMCHIN, DELTACORP and PNB from trading in the futures and options (F&O) segment of the stock exchange.

A stock enters the Ban List if its MWPL is above 95%. Implying that, Ban List shows the Futures and Options (FnO ) stocks whose combined open interest in all FnO contracts for a given period crosses 95% of Market-Wide Position Limit.

It seems that IBULHSGFIN, L&TFH, RBLBANK, CANBK, INDIACEM, and BHEL may be at risk of being added to the ban list.

DELTACORP and PNB has the possibilites of exited from ban list.

Daily Pivots

As per the above pivots data, 18050 to 18260 is the Nifty 50 trading range.

Read previous -Daily Insights- here
Extended Profit Booking Spurs Selling Across Sectors
Market Opens Flat, Experiences Selling Pressure
Indian Equity Benchmarks Reach 5-Month High, Extend Winning Streak

This article is only for educational purposes and is not an investment advice.