Bears Dominate Domestic Stock Market with Extended Losses

At the close, the Nifty 50 was at 19,281.75 down by 1.34%

Bears Dominate in Times of Global Uncertainty Amidst prevailing global uncertainties, the domestic stock market is enduring an extended bearish phase. Benchmark indices have been on a continuous decline for four consecutive sessions. The trading day started with a downward trajectory and struggled to recover, ultimately closing in the red. Notably, the NSE Nifty 50, which opened with a 1.34% drop, continued its decline, settling below the critical 19,300 level. This negative sentiment reverberated globally, with East Asian and European markets also opening lower. One of the contributing factors to this global market distress is the surge in US bond yields.

Pessimism Persists Despite Positive Indicators Despite some positive indicators, such as the healthy performance of private banks and slight reductions in oil prices, investor confidence remained pessimistic. This led to widespread consolidation in the domestic markets. Ongoing unrest in West Asia further added to apprehensions and contributed to the existing uncertainty.

Elevated Interest Rates and Energy Prices Impact Heightened interest rates and the continuous increase in energy prices have raised concerns about a potential moderation in economic growth. This has resulted in increased risk aversion, especially in Indian mid- and small-cap sectors, banks, metals, and energy stocks.

Geopolitical Tensions Add to Market Volatility Geopolitical tensions, particularly the Israel-Hamas conflict in the Middle East, have had a significant impact on financial markets. In the last hour of trading, benchmark indices experienced a sharp decline as investors, already concerned about rising interest rates and inflation, reacted to heightened uncertainty. These factors collectively contribute to a weak sentiment in global equities, as geopolitical events introduce additional volatility and risk into the financial landscape.

Bank Nifty: Down by 1.31%

Bank Nifty initially opened on a positive note but later faced a decline of 1.31 percent, closing in the negative territory at 43,151.20. Similarly, the BSE Sensex, another significant benchmark index, saw a decline of 1.26 percent, ending the session in the red at 64,571.88.

Regrettably, today’s market favored the bears, with every sector closing in the negative. Media stocks, in particular, experienced a significant decline of 4.98%, shedding light on the challenges at hand. Within the media sector, Network18 Media & Investments Ltd. suffered the most with a loss of -9.11%, closely followed by Hathway Cable & Datacom Ltd. at -6.96% and TV18 Broadcast Ltd. at -6.82%.

Foreign Institutional Investors (FIIs/FPIs) made purchases totaling Rs. 8,229.80 crore and sold shares worth Rs. 7,977.55 crore. Their net activity in the market amounted to Rs. 252.25 crore.

On the other hand, Domestic Institutional Investors (DIIs) acquired shares worth Rs. 8,022.52 crore and sold shares valued at Rs. 6,910.68 crore. Their net investment in the market stood at Rs. 1,111.84 crore.

Bank Nifty

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

Today, the Bank Nifty sector did not witness any gainers. Conversely, the sector’s most significant losers included Punjab National Bank, experiencing a decline of 3.88%, Bank of Baroda with a 3.73% decrease, IDFC First Bank showing a 2.92% decline, Federal Bank with a 2.06% drop, and State Bank of India, which saw a 1.90% decline. These results indicate that the majority of banking stocks did not perform well during the day.

Buzz

Rupee Faces Pressure Amidst Market Volatility

The Indian rupee encountered some headwinds in the foreign exchange market, depreciating by 6 paise to reach 83.18 against the US dollar. This drop was primarily driven by significant losses in the local stock market and the surge in US bond yields, which reached 5 percent.

However, the rupee found some relief from easing crude oil prices and the stability of the US dollar in international markets. Crude oil prices witnessed a slight decline, with Brent crude falling by 0.23 percent to $91.95 per barrel.

At the interbank foreign exchange market, the rupee opened lower at 83.13 and traded within a tight range, oscillating between 83.09 and 83.19 against the US dollar throughout the day. Eventually, the local unit settled at 83.18 (pro), marking a 6 paise loss compared to the previous close at 83.12 on Friday.

Buzzing

Mahindra & Mahindra Ltd. displayed a positive trajectory, with its share price increasing by 0.18% from the previous closing price of Rs 1,558.25. The stock last traded at Rs 1,561.00. Notably, the company’s annual revenue growth of 34.43% outperformed its 3-year CAGR of 16.85%, showcasing robust financial performance. Additionally, the Return on Equity (ROE) for the year ending March 31, 2023, stood at an impressive 18.24%, surpassing the 5-year average of 10.72%. This indicates a strong position in terms of shareholder value.

On the other hand, LTIMindtree Ltd. experienced a setback, with its share price declining by -3.92% from the previous closing price of Rs 5,416.20. The stock last traded at Rs 5,204.00. However, it’s worth noting that a recent weekly stochastic crossover on October 20, 2023, could be seen as a buy signal, historically leading to an average price gain of 8.14% within 7 weeks. Furthermore, LTIMindtree Ltd. exhibited remarkable annual revenue growth of 109.1%, outperforming its 3-year CAGR of 43.86%. The company also announced a dividend of Rs 20.0 per share, strengthening its investor appeal.

Advance Decline Ratio

Today, the advance-decline ratio was 0.12, and the market breadth was negative. The volatility index India Vix increased by 0.80 percent to settle at 10.91 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 267
Decliners – 2223
52Wk High –  59
52Wk Low – 43
High Band Hitters – 57
Low Band Hitters – 231
200d SMA – 18600
50d SMA – 19616
20d SMA – 19630

Top Gainers and Losers Stocks

The top gainers were M&M (+0.18%), and Bajaj Finance (+0.07%).

The top losers were LTIM (-3.92%), Adani Enterprises (-3.71%), Hindalco (-3.07%), JSW Steel (-3.03%), and Adani Ports (-2.85%).

Top Gainers and Losers Sector

The top losers sector were Media (+4.98%), Metal (+3.26%), Realty (+2.49%), IT (+1.97%), and Oil & Gas (-1.95%).

SECTORS – NOTABLE ACTION
MEDIA -4.98%
METAL -3.26%
REALTY -2.49%

Stocks Ban List

(SEBI) F&O ban list (IBULHSGFIN open at -173.60 and close at -157.50) 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.

PNB, METROPOLIS, RBLBANK, NMDC, L&TFH, PVRINOX, BIOCON, CHAMBLFERT, BHEL, SAIL, NATIONALUM, and SUNTV stock has the possibilities of enterance in the ban list.

IBULHSGFIN stock has the possiblities of exit from ban list.

Daily Pivots

As per the above pivots data, 19160 to 19490 is the Nifty 50 trading range.

Read previous -Daily Insights- here
Global Market Weakness Drags Down Domestic Stock Market for Third Consecutive Day
Global Equities Decline Amid Middle East Conflict Concerns
Market Recovery Short-Lived Sectors Face Selling Pressure

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