Indian Equities Start the Week Strong with Impressive Gains

At the close, the Nifty 50 was at 21,441.35 up by 0.43%

The NSE Nifty 50 displayed a promising start, opening higher by 0.43% and sustaining a positive momentum throughout the trading day after the Christmas holiday. Closing in the green zone, the index concluded at around 21,450 points, marking the third consecutive day of gains. Despite subdued global cues, robust buying activities across various sectors, excluding IT stocks, fortified the Nifty’s position above the 21,400 mark, culminating in a session closure near the day’s peak.

With Indian equities kickstarting the truncated week on a robust note, the Nifty index steadily accumulated gains, reaching 21,441.35, witnessing an upswing of 91.95 points. Notably, chemical counters exhibited significant strength, reclaiming lost momentum, while Defence stocks surged to fresh highs with increased trading volumes.

However, despite this positive trajectory, the Nifty predominantly traded sideways post the initial positive surge. The prevailing sentiment remains optimistic as the index remains positioned above critical moving averages. At the 21,500 level, a significant resistance is anticipated, indicating a potential turning point. A decisive breakthrough beyond this level could potentially trigger a substantial rally, although, for now, the index is expected to fluctuate within the range of 21,300 and 21,500.

The current scenario suggests that for a significant upward move, support from the banking index is pivotal. Failing this, a resurgence of profit-taking activities might ensue. Given these dynamics, traders are advised to exercise caution and avoid overly aggressive trades within the index. The focus should pivot towards identifying stock-specific opportunities amidst these market fluctuations for prudent decision-making and capitalizing on potential growth avenues.

Bank Nifty: Up by 0.49%

The Bank Nifty initiated the trading session on a positive note, opening with an upward movement of 0.49%. This momentum persisted throughout the day, culminating in a green closure at 47,724.85, showcasing a positive growth trajectory. Simultaneously, the BSE Sensex mirrored this trend, recording an increase of 0.32%, eventually closing positively at a high of 71,336.80.

In the sectorial front, the Oil & Gas sector has surged notably, marking a 1.51% increase. Castrol India Ltd. stands out as a frontrunner within this domain, exhibiting a remarkable gain of 13.66%. Concurrently, Hindustan Petroleum Corporation Ltd. also showcases a notable rise, marking a 4.20% increase. On the flip side, the Media sector has encountered a downturn, experiencing a decline of 0.58%. Within this sphere, PVR Inox Ltd. faces a downturn with a loss of -2.46%, closely followed by Dish TV India Ltd. with a decrease of -2.03%.

Foreign Institutional Investors (FIIs/FPIs) recorded a purchase value of Rs. 6,174.15 crore and a corresponding sale value of Rs. 6,269.35 crore, resulting in a net value of -Rs. 95.20 crore. On the other hand, Domestic Institutional Investors (DIIs) engaged in transactions with a buy value of Rs. 8,830.04 crore and a sell value of Rs. 8,663.00 crore, yielding a net value of Rs. 167.04 crore.

Bank Nifty

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

The gainers included Kotak Bank with a 1.38% increase, HDFC Bank with a 0.79% increase, IndusInd Bank with a 0.67% increase, Bandhan Bank with a 0.64% increase, and Bank of Baroda with a 0.63% increase. On the other hand, the biggest losers in the sector included Punjab National Bank wit a 0.50% decline. These results suggest that most of the banking stocks performed better for the day.

Rupee Slips Marginally Against USD Due to External Factors

The Indian rupee experienced a minor setback, sliding by 3 paise to close at 83.19 against the US dollar on Tuesday. This dip was primarily influenced by a robust US currency and the outflow of foreign funds. However, despite these challenges, positive trends in the equity market and a decline in crude oil prices served as stabilizing factors, curbing the rupee’s decline.

Throughout the trading day, the domestic currency fluctuated within a range of 83.10 to 83.21 against the greenback after opening at 83.17 in the interbank foreign exchange market. The closing value of 83.19 against the dollar marked a nominal 3-paise drop from its previous closing rate of 83.16 on Friday. Monday’s closure of forex markets due to Christmas added to the market dynamics.

The rupee’s depreciation was primarily influenced by the strengthening US dollar and the outflow of Foreign Institutional Investments (FIIs). Nevertheless, the domestic market’s positivity and a decrease in crude oil prices countered this downside pressure.

Forecasts indicate that the rupee might face challenges due to heightened demand for the US dollar stemming from import needs and FII selling pressures. Geopolitical tensions in the Red Sea could further impact the rupee’s stability at higher levels. Additionally, market watchers are eyeing cues from the US house price index data. Expectations suggest that the USD-INR spot price may trade within a range of Rs 82.90 to Rs 83.50 in the near term.

In the global context, the Brent crude oil benchmark experienced a marginal increase of 0.03%, reaching $79.09 per barrel, further contributing to the market’s nuanced dynamics.

Stocks Highlights

Divi’s Laboratories Ltd. exhibited an uptrend in its share price, marking a significant 4.55% increase from its previous close of Rs 3,694.95 to Rs 3,863.00. Despite this surge, the company faced a decline in its sales topline, experiencing a 10.6% contraction. Notably, this marked the first revenue decline in the last three years. In terms of expenditure, the company allocated less than 1% of its operating revenues toward interest expenses and 12.55% towards employee costs as of the financial year ending March 31, 2023.

In contrast, Bajaj Finance Ltd. observed a downtrend in its share price, decreasing by -1.65% from its earlier close of Rs 7,295.30 to Rs 7,175.05. However, the company demonstrated a commendable annual revenue growth of 30.86%, surpassing its 3-year Compound Annual Growth Rate (CAGR) of 16.03%. Regarding expenses, Bajaj Finance allocated a more substantial portion, around 30.34% of its operating revenues, to interest expenses. Similarly, it devoted 12.22% of its revenue towards employee costs for the fiscal year ending March 31, 2023.

Advance Decline Ratio

Today, the advance-decline ratio was 1.44, and the market breadth was positive. The volatility index India Vix increased by 7.07 percent to settle at 14.68 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1465
Decliners – 1018
52Wk High –  166
52Wk Low – 13
High Band Hitters – 151
Low Band Hitters – 52
200d SMA – 19080
50d SMA – 20053
20d SMA – 20914

Top Gainers and Losers Stocks

The top gainers were Divi’s Laboratories (+4.55%), Hero MotoCorp (+2.65%), Adani Enterprises (+2.45%), NTPC (+2.36%), and ONGC (+2.16%).

The top losers were Bajaj Finance (-1.65%), Bajaj Finserv (-1.26%), Infosys (-1.08%), TCS (-0.68%), and Tata Motors (-0.65%).

Top Gainers and Losers Sector

The top gainers sector were Oil & Gas (+1.51%), Metal (+1.14%), Pharma (+1.03%), Auto (+0.98%), and FMCG (+0.70%).

The top losers sector were Media (-0.58%), and IT (-0.41%).

SECTORS – NOTABLE ACTION
OIL & GAS +1.51%
METAL +1.14%
PHARMA +1.03%
MEDIA -0.58%
IT -0.41%

Stocks Ban List

(SEBI) F&O ban list (NATIONALUM open at +116.50 and close at +115.35), (HINDCOPPER open at +229.00 and close at +233.25), (DELTACORP open at +144.00 and close at +145.25), (BALRAMCHIN open at +391.35 and close at -388.25), (INDIACEM open at -251.45 and close at +261.30), (SAIL open at +113.65 and close at +113.55), and (ASHOKLEY open at +173.25 and close at +173.90) are not currently on 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.

PEL, GMRINFRA, IRCTC, ABCAPITAL, ZEEL, IBULHSGFIN, PVRINOX, INDUSTOWER, and ESCORTS stocks has the possibilities of entrance in the ban list.

SAIL, and ASHOKLEY stock has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 21300 to 21550 is the Nifty 50 trading range.

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