NSE Nifty 50 Extends Fall, Hits Below 21,500

At the close, the Nifty 50 was at 21,462.25 down by 0.51%

In a demanding trading session, the NSE Nifty 50 faced a formidable challenge as it opened with a 0.51% dip, ultimately closing below the crucial 21,500 mark. Despite a mid-session recovery attempt, the equity benchmarks sustained their third consecutive day of losses. This downward trend was accentuated by a sell-off in banks and IT stocks, influenced by weak global cues.

Initially echoing global patterns, the market commenced on a lower note and extended the sell-off during the early hours. A noteworthy recovery around noon was, however, short-lived, with the market succumbing once again to persistent selling pressure. Notably, HDFC Bank shares continued their decline, contributing significantly to the overall negative sentiment.

Sectors such as energy, banking, and metal witnessed substantial losses, while pharma and realty displayed some resilience. Despite volatile swings, the broader indices managed to conclude the session unchanged.

Investor caution prevailed amidst weak global cues, driven by concerns over reduced FED cuts, robust US retail sales, and escalating global bond yields. Disruptions in global shipping and crude production, influenced by oil price advances and rising rate risks, further fueled market uncertainties. As investors grapple with these challenges, a prudent approach involves staying vigilant, adapting to evolving conditions, and making informed decisions in this dynamic market landscape.

Bank Nifty: Down by 0.76%

The Bank Nifty commenced the trading session on a bearish note, opening in the red and registering a 0.76% decline. The day concluded with the index closing at 45,713.55, reflecting a persistent negative trend. Simultaneously, the BSE Sensex experienced a marginal downturn, opening with a 0.44% decrease and closing at a low of 71,186.86.

In the sectorial front, the pharmaceutical sector has recently exhibited positive momentum, with an overall gain of 1.03%. Aurobindo Pharma Ltd. stands out as a frontrunner in this sector, experiencing a significant increase of 3.80%, closely followed by Sun Pharmaceutical Industries Ltd. with a gain of 2.93%. On the flip side, the consumer durables sector has faced a setback, recording a decline of 1.70%. Titan Company Ltd. witnessed a notable loss of -2.41%, while Crompton Greaves Consumer Electricals Ltd. experienced a downturn of -2.32%.

Foreign Institutional Investors (FIIs/FPIs) engaged in a net selling activity, with a buy value of Rs. 14,934.98 Cr. and a higher sale value of Rs. 24,836.54 Cr. This resulted in a net value of -Rs. 9,901.56 Cr., signifying a notable divestment by foreign investors in the market. On the other hand, Domestic Institutional Investors (DIIs) demonstrated a contrasting trend, with a buy value of Rs. 15,637.89 Cr. and a sale value of Rs. 9,660.77 Cr. The net value for DIIs stood at Rs. 5,977.12 Cr., indicating a positive sentiment as domestic institutions engaged in a net buying activity during this period.

Bank Nifty

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

The gainers included IDFC First Bank with a 1.58% increase, Bank of Baroda with a 1.33% increase, Punjab National Bank with a 1.29% increase, Axis Bank with a 1.01% increase, and Federal Bank with a 0.82% increase. On the other hand, the biggest losers in the sector included AU Bank with a 3.23% decline, HDFC Bank with a 3.09% decline, IndusInd Bank with a 1.71% decline, and Kotak Bank with a 0.11% decline. These results suggest that some of the banking stocks performed better for the day.

Rupee Gains Ground Against the US Dollar Amidst Global Economic Trends

The Indian rupee exhibited a modest gain of 2 paise, settling at 83.12 against the US dollar on Thursday. This uptick was influenced by the weakening of the US dollar against its major counterparts in international markets. Despite facing headwinds from a sluggish domestic equity market and escalating crude oil prices, the rupee’s movement remained within a narrow range.

Opening at 83.16 in the interbank foreign exchange, the rupee fluctuated between 83.10 and 83.18 against the greenback before concluding the day at 83.12, marking a marginal improvement from its previous close of 83.14 on Wednesday.

The dollar index, a measure of the dollar’s strength against a basket of six currencies, showed a 0.15% decline, settling at 103.05 on Thursday. This dip was triggered by robust US retail sales and industrial production data, which tempered expectations of an interest rate cut by the Federal Reserve in March 2024.

The global oil benchmark, Brent crude futures, experienced a 0.56% increase, reaching $78.32 per barrel. This rise in oil prices contributed to the complex interplay of factors influencing currency movements, highlighting the interconnectedness of global economic variables.

Stocks Highlights

Sun Pharmaceutical Industries Ltd. witnessed a notable uptick in its share price, rising by 2.93% to Rs 1,337.00 from its previous close of Rs 1,299.00. Notably, the company has demonstrated resilience, with intraday declines higher than 5% occurring in only 0.99% of trading sessions over the last 19 years. Sun Pharma also outperformed its 5-year average Return on Equity (ROE), delivering a commendable 15.13% against the 8.89% average.

However, a potential concern emerges as a 14-day moving crossover signaled a sell, with an average price decline of -2.13% within 7 days of this signal in the last 5 years. Investors should monitor these developments closely to make informed decisions.

Conversely, LTIMindtree Ltd. faced a downturn, witnessing a substantial drop of -10.73% in its share price from Rs 6,275.60 to Rs 5,602.00. Despite this setback, the company showcased robust financials, with an annual revenue growth of 109.1%, surpassing its 3-year Compound Annual Growth Rate (CAGR) of 43.86%.

Intriguingly, a buy signal emerged for LTIMindtree as the daily Moving Average Convergence Divergence (MACD) crossed over, historically resulting in an average price gain of 5.23% within 10 days. Additionally, prudent fiscal management was evident, with the company allocating less than 1% to interest expenses and 62.92% towards employee costs in the fiscal year ending March 31, 2023.

Advance Decline Ratio

Today, the advance-decline ratio was 0.87, and the market breadth was negative. The volatility index India Vix decreased by 6.69 percent to settle at 14.07 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1159
Decliners – 1334
52Wk High –  105
52Wk Low – 18
High Band Hitters – 110
Low Band Hitters – 68
200d SMA – 19459
50d SMA – 20846
20d SMA – 21644

Top Gainers and Losers Stocks

The top gainers were Sun Pharma (+2.93%), Tech Mahindra (+2.36%), Cipla (+2.01%), Tata Motors (+1.74%), and M&M (+1.23%).

The top losers were LTIM (-10.73%), NTPC (-3.14%), HDFC Bank (-3.09%), Titan (-2.41%), and Power Grid (-2.34%).

Top Gainers and Losers Sector

The top gainers sector were Pharma (+1.03%), Realty (+0.72%), Oil & Gas (+0.60%), and Auto (+0.27%).

The top losers sector were Consumer Durables (-1.70%), Financial Services (-1.00%), Metal (-0.84%), IT (-0.62%), and FMCG (-0.54%).

SECTORS – NOTABLE ACTION
PHARMA +1.03%
REALTY +0.72%
OIL & GAS +0.60%
CONSUMER DURABLES -1.70%
FINANCIAL SERVICES -1.00%
METAL -0.84%

Stocks Ban List

(SEBI) F&O ban list (NATIONALUM open at -133.00 and close at -131.25), (IEX open at -145.10 and close at -137.20), (POLYCAB open at +4460.00 and close at -4436.05), (SAIL open at -113.10 and close at -113.05), (ZEEL open at -245.85 and close at +248.20), (ABFRL open at -223.00 and close at -223.15), (ASHOKLEY open at -170.80 and close at +173.55), (METROPOLIS open at +1552.35 and close at -1565.05), (DELTACORP open at -145.95 and close at -145.15), (HINDCOPPER open at -259.35 and close at -253.95), (PVRINOX open at +1509.40 and close at -1480.20), (BANDHANBNK open at +227.50 and close at -227.60), and (CHAMBLFERT open at -380.55 and close at -382.60) 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.

GNFC, RBLBANK, BALRAMCHIN, IDEA, PNB, NMDC, UPL, GMRINFRA, SUNTV, GRANULES, BHEL, and IRCTC stocks has the possibilities of entrance in the ban list.

PVRINOX, BANDHANBNK, and CHAMBLFERT stocks has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 21300 to 21600 is the Nifty 50 trading range.

Read previous -Daily Insights- here
Banking Pack Takes a Hit as HDFC Bank’s Q3 Results Cause Market Plunge
Nifty’s Impressive 5-Day Streak Comes to an End at 22-1-24
Record Highs Despite Mixed Global Cues in the Indices

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