Nifty’s Winning Streak Cut Short by Market Volatility After Ministerial Reshuffle

At the close, the Nifty 50 was at 23,259.20 down by 0.13%

On June 10, the NSE Nifty 50 index commenced on a positive note but concluded the day in the red, marking a decline of 0.13%. Despite starting at a fresh record high of 23,411.9, the index struggled to maintain momentum and fluctuated throughout the session. However, last-hour selling pressure pushed the Nifty below the crucial 23,250 mark, contributing to its downward trajectory.

The Indian market’s downward movement followed three consecutive sessions of gains, as investors awaited details regarding Prime Minister Narendra Modi’s new panel of ministers and their portfolios post the recent swearing-in ceremony. The Nifty 50 index closed at 23,259.20, down by 0.13% or 30.95 points.

Investor sentiment was also influenced by the anticipation of US inflation data and the Federal Reserve’s policy meeting scheduled for June 12. Market participants keenly awaited updates on the Fed’s economic projections and interest rate stance, which could impact global market trends.

With the formation of the new government in India, the market is experiencing a lack of immediate catalysts, suggesting potential consolidation in the near term. Institutional flows depict a mixed trend, with Foreign Institutional Investors (FIIs) gradually covering their shorts and Domestic Institutional Investors (DIIs) booking profits following the market’s historic highs.

While optimism for a rate cut in India persists, uncertainties loom regarding the Fed’s stance amid healthy US economic indicators. Any deviation from the earlier guided rate cut by the Fed could test market resilience and patience. As the market navigates through these factors, investors should remain vigilant and adapt their strategies accordingly.

Bank Nifty: Down by 0.04%

Bank Nifty commenced on a positive note, opening in the green but eventually closed in the red, registering a marginal decline of 0.04%. The index concluded the session at 49,780.90, reflecting a slight downturn in banking sector stocks.

Simultaneously, the BSE Sensex experienced a similar trajectory, opening with a slight gain but ultimately closing lower by 0.27%. The index ended the day at a low of 76,490.08, indicating broader market weakness across various sectors.

In the sectorial front, the media sector experienced significant growth, gaining 1.86%. Leading the charge, Zee Entertainment Enterprises Ltd. saw a remarkable increase of 4.06%, while Saregama India Ltd. also enjoyed a solid rise of 2.13%.

Conversely, the IT sector faced a downturn, emerging as the top loser with a drop of 1.83%. Within this sector, Coforge Ltd. suffered a substantial decline, losing 3.91%. Similarly, Mphasis Ltd. experienced a significant decrease of 2.99%.

FIIs/FPIs exhibited robust activity, with a buy value of Rs. 13,721.97 crore and a sale value of Rs. 11,149.59 crore, resulting in a net value of Rs. 2,572.38 crore. This indicates a notable net investment by foreign institutional investors in Indian markets during the trading session.

Similarly, Domestic Institutional Investors (DIIs) were actively engaged in the market, with a buy value of Rs. 16,933.99 crore and a sale value of Rs. 14,169.53 crore. The net value for DIIs stood at Rs. 2,764.46 crore, reflecting substantial net investment by domestic institutional players.

Bank Nifty

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

The gainers included Bank of Baroda with a 1.94% increase, Axis Bank with a 0.86% increase, Bandhan Bank with a 0.48% increase, AU Bank with a 0.30% increase, and Punjab National Bank with a 0.18% increase.

On the other hand, the biggest losers in the sector included HDFC Bank with a 0.88% decline, Kotak Bank with a 0.63% decline, IDFC First Bank with a 0.58% decline, IndusInd Bank with a 0.49% decline, and Federal Bank with a 0.24% decline. These results suggest that some of the banking stocks performed better for the day.

Rupee Declines Amid Strong US Dollar and Domestic Market Trends

The Indian rupee settled 10 paise lower at 83.50 against the US dollar on Monday, influenced by a strengthening American currency in global markets and a sluggish trend in domestic equities. The rupee’s decline was somewhat cushioned by reduced political uncertainties as Narendra Modi was sworn in for his third term as Prime Minister on Sunday.

In early trade on Monday, the rupee opened at 83.48 and quickly depreciated to 83.50 against the dollar, reflecting a 10 paise drop from its previous close. This decline was largely driven by a rising dollar index and increasing US yields. Despite the easing of political uncertainties, the robust performance of the American currency pressured the local unit.

On Friday, the rupee had appreciated by 13 paise to 83.40 against the US dollar. Meanwhile, the dollar index, which measures the dollar’s strength against six major currencies, rose by 0.29% to 105.18. Additionally, Brent crude futures, a global oil benchmark, increased by 0.31% to $79.87 per barrel, impacting the rupee’s performance.

The rupee’s movement reflects a complex interplay of global currency trends, domestic political stability, and market sentiment. Investors should monitor these factors closely as they navigate the forex market, especially considering the ongoing fluctuations in global oil prices and the strength of the US dollar.

Stocks Highlights

UltraTech Cement Ltd. shares surged by 3.26%, rising from a previous close of Rs 10,463.15 to a last traded price of Rs 10,804.00. This growth reflects the company’s robust performance, highlighted by a 21.77% quarter-on-quarter revenue increase, the highest in three years. Over a three-year period, UltraTech Cement delivered a return of 55.59%, surpassing the Nifty 100’s 52.57% return. The company allocated 1.37% of operating revenues to interest expenses and 4.28% to employee costs in the fiscal year ending March 31, 2024.

Tech Mahindra Ltd. experienced a share price drop of 2.66%, moving from Rs 1,377.60 to a last traded price of Rs 1,341.00. This decline comes amid a 2.47% contraction in sales, marking the first revenue decline in three years. Despite this, Tech Mahindra provided a three-year return of 30.92%, compared to the Nifty 100’s 52.57%. Notably, the company spent less than 1% of its operating revenues on interest expenses and 56.02% on employee costs for the year ending March 31, 2024. Tech Mahindra’s three-year return was 30.92%, outperforming the Nifty IT’s 27.71% return.

Advance Decline Ratio

Today, the advance-decline ratio was 1.86, and the market breadth was positive. The volatility index India Vix decreased by 2.87 to settle at 16.40 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 1729
Decliners – 932
52Wk High – 178
52Wk Low – 16
High Band Hitters – 178
Low Band Hitters – 56
200d SMA – 21150
50d SMA – 22493
20d SMA – 22656

Top Gainers and Losers Stocks

The top gainers were UltraTech Cement (+3.26%), Grasim (+2.43%), Hero MotoCorp (+2.30%), Cipla (+2.12%), and Power Grid (+2.09%).

The top losers were Tech Mahindra (-2.66%), Infosys (-2.31%), Wipro (-1.88%), LTIM (-1.59%), and Bajaj Finance (-1.53%).

Top Gainers and Losers Sectors

The top gainers sector were Media (+1.86%), Realty (+1.32%), Pharma (+1.00%), Consumer Durables (+0.71%), and FMCG (+0.07%).

The top losers sector were IT (-1.83%), Metal (-0.38%), Oil & Gas (-0.08%), and Financial Services (-0.05%).

SECTORS – NOTABLE ACTION
MEDIA +1.86%
REALTY +1.32%
PHARMA +1.00%
IT -1.83%
METAL -0.38%
OIL & GAS -0.08%

Stocks Ban List

(SEBI) F&O ban list (BALRAMCHIN open at +400.00 and close at -396.80), (SAIL open at +152.60 and close at -150.60), and (ZEEL open at +157.00 and close at +164.41)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.

HINDCOPPER, INDIACEM, PEL, and PNB stocks has the possibilities of entrance in the ban list.

Daily Pivots

As per the above pivots data, 23100 to 23450 is the Nifty 50 trading range.

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