Domestic Markets Surge on Global Positivity—What’s Next for Investors?

At the close, the Nifty 50 was at 24,367.50 up by 1.04%

On August 9, the NSE Nifty 50 delivered a notable performance, surging by 1.04% to close at 24,367.50. This significant uptick marked a recovery from earlier losses and saw the index climb past the 24,400 level during the session.

The day began with a gap-up opening, spurred by positive global cues, and continued its ascent as broad-based buying across sectors drove the market higher. The rebound was notably led by gains in IT stocks, which buoyed the overall performance of Indian equity indices.

The uptick in the Nifty 50 follows a sharp sell-off earlier in the week, with investor sentiment improving as U.S. unemployment claims fell more than anticipated. This decline in claims alleviated recession concerns in the U.S., which in turn positively impacted global market dynamics.

Despite this recovery, the market remains cautious amid global volatility, including recent geopolitical tensions and fluctuations in currency markets. Foreign Institutional Investors (FIIs) have been net sellers, withdrawing Rs. 20,767.20 crores as of August 2024, influenced by a confluence of global factors such as a stronger USD-JPY exchange rate and geopolitical unrest.

The Nifty 50’s ability to surpass the lower end of the bearish gap zone from August 5 (24,350) suggests resilience, but sustained gains will require the index to hold above this level. While the IT sector continues to outperform, broader market gains may be tempered by a lack of fresh triggers and subdued earnings forecasts.

As we navigate through these turbulent times, can the Nifty 50 maintain its upward trajectory, or are we on the brink of another shift? The coming days will be crucial in determining whether this recovery is the beginning of a new trend or just a temporary respite.

Bank Nifty: Up by 0.65%

Domestic equity benchmarks, the Bank Nifty and BSE Sensex, concluded today’s trading session on a positive note. The Bank Nifty kicked off the day with a robust 0.65% gain and maintained its upward trajectory to close at 50,484.50. Similarly, the BSE Sensex mirrored this bullish sentiment, registering a commendable 1.04% increase and culminating at a fresh high of 79,705.91.

In the sectorial front, the media sector experienced a robust gain of 1.83% today, marking a day of solid performance across the board. Standing tall among the winners, Tips Industries Ltd. soared by an impressive 5.24%, reflecting strong investor confidence in its growth trajectory. Network18 Media & Investments Ltd. followed suit, climbing 3.43% as it continues to capitalize on its diverse media portfolio.

Interestingly, the day saw no losers, highlighting the sector’s overall resilience and positive momentum.

Foreign Institutional Investors (FIIs) reported a buy value of Rs. 12,454.93 crores and a sale value of Rs. 12,048.21 crores, resulting in a net inflow of Rs. 406.72 crores.

On the other hand, DIIs demonstrated a more significant impact with a buy value of Rs. 15,190.99 crores and a sale value of Rs. 11,211.40 crores. This resulted in a substantial net inflow of Rs. 3,979.59 crores.

Bank Nifty

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

The gainers included State Bank of India with a 2.10% increase, Bank of Baroda with a 2.09% increase, Federal Bank with a 1.66% increase, Punjab National Bank with a 1.03% increase, and IDFC First Bank with a 1.00% increase.

On the other hand, the biggest losers in the sector included Kotak Bank with a 0.16% decline. These results suggest that most of the banking stocks performed better for the day.

Gold and Silver Rate (INR) 09th August, 2024

Indian Rupee’s Narrow Range Amid Market Fluctuations

On August 9, the Indian rupee settled slightly higher by 2 paise at 83.95 (pro) against the US dollar, following a day of narrow-range consolidation. The rupee’s modest gain was driven by positive movements in the domestic markets, though a rise in crude oil prices tempered any significant appreciation.

Throughout the trading session, the rupee fluctuated between an intraday low of 83.96 and a high of 83.88 before closing at 83.95, a minor increase from its previous close. This followed a recent dip to an all-time low of 84.09 on August 5, reflecting ongoing volatility.

On August 8, the rupee had edged down by 2 paise to 83.97, with the Reserve Bank of India’s latest monetary policy announcement adding to market uncertainty. Investors are now anticipating upcoming US CPI, India CPI, WPI, IIP data, and India’s trade figures, all due next week.

Meanwhile, the dollar index dipped by 0.05% to 103.15, influenced by better-than-expected weekly unemployment claims data. In the global oil market, Brent crude saw a modest increase of 0.18%, trading at $79.30 per barrel.

As the rupee navigates these complex dynamics, will it find stability or continue to waver in the face of international and domestic pressures?

Stocks Highlights

Eicher Motors Ltd. has shown impressive momentum recently, with its share price climbing 5.68% from a previous close of Rs 4,576.90 to a new high of Rs 4,837.00. This upward trend is underscored by the company’s strong return on equity (ROE) of 22.17% for the year ending March 31, 2024, significantly surpassing its 5-year average of 17.54%.

Moreover, Eicher Motors efficiently managed its expenses, dedicating less than 1% of its revenues to interest and 7.47% to employee costs. Notably, its stock has delivered a robust 66.59% return over three years, outpacing the Nifty 100’s 53.85% return.

In contrast, HDFC Life Insurance Company Ltd. has faced a slight dip, with its share price decreasing by -1.09% from Rs 710.35 to Rs 702.60. Intriguingly, over the past six years, only 1.32% of trading sessions saw intraday gains exceeding 5%. However, the company has demonstrated resilience with a 42.38% revenue growth, surpassing its 3-year CAGR of 12.22%.

A bullish trend is on the horizon, as indicated by a 5-day moving average crossover, which historically signals an average gain of 2.45% within a week. Despite its modest 3-year return of 5.49% compared to the Nifty 100, the stock’s potential remains an intriguing question for investors.

Will HDFC Life Insurance’s recent signals transform its performance, or will it continue to lag behind?

Advance Decline Ratio

Today, the advance-decline ratio was 1.58, and the market breadth was positive. The volatility index India Vix decreased by 7.45 to settle at 15.37 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 1638
Decliners – 1039
52Wk High – 122
52Wk Low – 29
High Band Hitters – 127
Low Band Hitters – 44
200d SMA – 22108
50d SMA – 23968
20d SMA – 24544

Top Gainers and Losers Stocks

The top gainers were Eicher Motors (+5.68%), M&M (+3.05%), Shriram Finance (+2.88%), Tata Motors (+2.81%), and Tech Mahindra (+2.63%).

The top losers were HDFC Life (-1.09%), Kotak Bank (-0.16%), Maruti (-0.12%), Sun Pharmaceutical (-0.10%).

Top Gainers and Losers Sectors

The top gainers sector were Media (+1.83%), Auto (+1.72%), IT (+1.55%), Realty (+1.55%), and Oil & Gas (+1.33%).

SECTORS – NOTABLE ACTION
MEDIA +1.83%
AUTO +1.72%
IT +1.55%

Stocks Ban List

(SEBI) F&O ban list (INDIACEM open at +370.00 and close at -367.00), (LICHSGFIN open at +645.00 and close at -638.15), (MANAPPURAM open at +202.00 and close at +204.77), (ABFRL open at -319.20 and close at +324.70), (PNB open at -115.75 and close at +115.27), (INDIAMART open at +2808.70 and close at -2777.25), (BSOFT open at +579.80 and close at +577.70), (HINDCOPPER open at +300.00 and close at +303.15), (RBLBANK open at +218.00 and close at +216.85), (ABCAPITAL open at +212.55 and close at +211.80), and (GNFC open at -666.80 and close at +667.10) 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.

BANDHANBNK, BIOCON, GRANULES, EXIDEIND, IEX, IDFCFIRSTB, SAIL, and PEL stocks has the possibilities of entrance in the ban list.

GNFC stock has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 24250 to 24500 is the Nifty 50 trading range.

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