Are Indian markets turning around ahead of the RBI decision? Will the Nifty 50 defy expectations and rise?

At the close, the Nifty 50 was at 25,013.15 up by 0.88%

Today’s trading session brought a breath of fresh air as the NSE Nifty 50 kicked off in green, soaring by 0.88% to close above the significant threshold of 25,000. After a grueling six-day losing streak, the Indian stock markets snapped back to life, buoyed by widespread buying across sectors, with the exception of metals.

What sparked this remarkable turnaround? Investors have been optimistic, especially ahead of the Reserve Bank of India’s policy outcome tomorrow. The indices had been under pressure due to escalating Middle East conflicts, which had sapped risk appetite and prompted foreign institutional investors to offload shares worth a staggering $6 billion.

However, today’s session showcased a remarkable recovery, with the Nifty rising 217.40 points to settle at 25,013.15. All sectors except metals ended the day in the green, with Media and Auto leading the charge.

The Mid and Small-cap stocks also shined, gaining over 2% and outpacing the frontline index. The Nifty’s formation of a bullish Harami candlestick pattern signals a potential trend reversal, further supported by hidden bullish divergence in the RSI.

After a punishing decline, the market’s near 1% gain today could serve as a beacon of hope for bulls. It’s a crucial moment as Nifty seeks confirmation of a double bottom around 24,700 levels, aiming for a sustainable upward move.

Can the Bulls Sustain This Momentum?

Looking ahead, Nifty faces immediate resistance in the 25,150-25,300 range. While the recovery in heavyweight stocks may propel Nifty further, the real challenge will be maintaining this upward momentum.

Amid this recovery, the recent BJP state election win has added a dose of optimism to the domestic market, providing support at the 25,800 level for Nifty 50. The anticipation surrounding the RBI’s policy outcome is palpable, with no rate cuts expected, but a possible shift to a neutral stance could energize the market further.

As investors eagerly await the Q2 results, there’s hope for marginal improvement in earnings on a QoQ basis.

Is the Nifty 50 set to defy expectations and surge higher? Keep your eyes peeled as the market narrative unfolds!

Bank Nifty: Up by 1.07%

In a refreshing turn of events, the Bank Nifty kicked off the day with a robust 1.07% increase, closing the session firmly in the green at 51,021.00. Meanwhile, the BSE Sensex also joined the upward trend, rising by 0.72% to finish at a high of 81,634.81.

on the sectorial front, Media stocks surged by an impressive 3.11%! Within this exciting landscape, Saregama India Ltd. dazzled with a staggering gain of 8.08%, while Tips Music Ltd. followed closely behind, soaring by 7.42%.

But hold on! The story isn’t all sunshine and rainbows. Metal stocks faced a tough day, emerging as the top loser with a decline of 0.93%. The challenges were particularly steep for NMDC Ltd., which stumbled by 3.91%, and Tata Steel Ltd., which experienced a dip of 2.72%.

Foreign Institutional Investors (FII/FPI) are in the red, with a net value of -5,729.60 crore. They recorded a buy value of 14,774.19 crore against a sale value of 20,503.79 crore.

Domestic Institutional Investors (DII) showed a much more optimistic picture, boasting a net value of 7,000.68 crore. They bought shares worth 19,494.71 crore while selling only 12,494.03 crore.

Bank Nifty

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

The gainers included HDFC Bank with a 2.07% increase, Federal Bank with a 2.06% increase, Bank of Baroda with a 1.99% increase, Canara Bank with a 1.68% increase, and IDFC First Bank with a 1.34% increase.

On the other hand, the biggest losers in the sector included AU Bank with a 0.63% decline. These results suggest that most of the banking stocks performed better for the day.

Gold and Silver Rate (INR) 8th October, 2024

Can the Rupee Hold Its Ground Amid Global Turmoil?

The Indian rupee has closed nearly unchanged, but beneath the surface, it’s a tale of resilience amidst mounting pressures. Ending the day at 83.9625 against the U.S. dollar, the currency has managed to dodge a significant dip, primarily thanks to the proactive measures from the Reserve Bank of India (RBI). These interventions have come in response to a host of challenges, including rising U.S. bond yields, soaring oil prices, and consistent outflows from local equities.

While the rupee is perilously close to its all-time low of 83.9850, RBI’s timely support has provided a lifeline, preventing it from weakening further. Informal directives issued to banks to avoid heavy bets against the rupee seem to have reshaped market strategies. Traders are now more cautious, adjusting their positions as they navigate this volatile landscape.

Moreover, the price of Brent crude oil has taken a slight dip, closing at $79.4 per barrel after a concerning five-day climb, a movement fueled by fears of disrupted supplies due to escalating conflicts in the Middle East. Despite the slight decrease in oil prices, their recent rise, coupled with the dollar index climbing to 102.5, intensifies inflation risks in India. As oil prices have surged about 10% this October, the RBI’s foreign exchange interventions are becoming increasingly crucial.

With inflation on the rise, can the RBI continue to hold the line and protect the rupee from further declines? The stakes are high, and the market watches with bated breath. What happens next could change the financial landscape dramatically—are you ready for what’s to come?

Stocks Highlights

Adani Enterprises Ltd. is making waves, with its share price soaring 4.94% from the previous close of Rs. 3,018.00. The stock’s last traded price hit Rs. 3,166.95. But is this a beacon of hope or just a fleeting moment?

Intraday Fact Check: In the past 19 years, only 3.82% of trading sessions have witnessed declines exceeding 5%. However, topline contraction raises eyebrows as sales plummeted 28.87%, marking the company’s first revenue drop in three years.

Sell Signal: Are Bears Lurking?
A crucial signal emerged yesterday with the 200-day moving average crossover. Historically, this has led to an average price decline of 6.23% within 30 days over the last five years. Still, there’s a silver lining: the stock delivered a remarkable 98.45% return over three years, vastly outperforming the Nifty 100, which offered 44.29%.

SBI Life Insurance Company Ltd. faced challenges, with its share price dropping 3.24% from the previous close of Rs. 1,787.95 to a last traded price of Rs. 1,730.00.

Intraday Fact Check: Over the past seven years, only 0.64% of trading sessions recorded declines greater than 5%. On a more positive note, the company has enough cash reserves to cover its contingent liabilities, ensuring stability amidst market volatility.

Outperforming the Competition?
SBI Life has outshined its three-year revenue CAGR, boasting an impressive annual revenue growth of 62.23%, compared to its three-year CAGR of 17.13%. In the returns department, it delivered a solid 47.15% over three years, again beating the Nifty 100’s 44.29%.

Advance Decline Ratio

Today, the advance-decline ratio was 3.67, and the market breadth was positive. The volatility index India Vix decreased by 3.26 to settle at 14.59 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 2178
Decliners – 594
52Wk High – 40
52Wk Low – 81
High Band Hitters – 133
Low Band Hitters – 161
200d SMA – 23165
50d SMA – 25045
20d SMA – 25503

Top Gainers and Losers Stocks

The top gainers were Trent (+7.95%), BEL (+5.29%), Adani Enterprises (+4.94%), Adani Ports (+4.86%), and M&M (+3.56%).

The top losers were SBI Life (-3.24%), Tata Steel (-2.72%), Titan (-2.35%), Bajaj Finserv (-2.30%), and JSW Steel (-1.66%).

Top Gainers and Losers Sectors

The top gainers sector were Media (+3.11%), Auto (+1.66%), Pharma (+1.44%), Oil & Gas (+1.27%), and Financial Services (+1.00%).

The top losers sector were Metal (-0.93%).

SECTORS – NOTABLE ACTION
MEDIA +3.11%
AUTO +1.66%
PHARMA +1.44%
METAL -0.93%

Stocks Ban List

(SEBI) F&O ban list (GNFC close at +639.85), (GRANULES close at +556.50), (PNB close at +102.49), (IDFCFIRSTB close at +73.13), (RBLBANK close at +196.01), (MANAPPURAM close at +182.92), (HINDCOPPER close at +314.30), (BSOFT close at +570.20), and (BANDHANBNK close at +187.66) 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.

CHAMBLFERT, SAIL, TATACHEM, IEX, BALRAMCHIN, GMRINFRA, CANBK, and NMDC stocks has the possibilities of entrance in the ban list.

Daily Pivots

As per the above pivots data, 24700 to 25200 is the Nifty 50 trading range.

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Nifty 50 Falls Below Key Levels –  Is the Worst Yet to Come? Will Geopolitical Risks Disturb the Markets?
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This article is only for educational purposes and is not an investment advice.