Euphoria to Panic: What Caused the Market’s Dramatic Plunge?

At the close, the Nifty 50 was at 24,010.60 down by 0.14%

Today, the NSE Nifty 50 exhibited a volatile trading session, starting positively but ending the day with a decline of 0.14%, closing above the 24,000 mark at 24,010.60. The market traded within a narrow range, reflecting cautious investor sentiment amid profit-taking activities that offset early gains.

Benchmark indices surrendered intraday gains, finishing in the red amidst high volatility. Despite a positive market trend, concerns over the overbought zone and profit booking by domestic investors persisted. The Nifty’s resilience above critical moving averages signals strong sentiment, yet ongoing rallies have made the index susceptible to corrections, especially if it dips below 24,000.

Indian equity indices achieved fresh record highs, with the Nifty surpassing 24,100 before retracing gains and closing lower. A small-bodied red candle formed, ending a four-day winning streak as participants opted to secure profits on the first day of the July series. The index’s ability to hold above 24,000 remains crucial, with potential downside towards 23,850/23,700 in the short term and resistance noted at 24,200 for higher gains.

In summary, while the Nifty 50 maintains strong underlying sentiment, today’s market action underscores the challenges of sustaining record levels amidst profit-taking and volatile trading conditions. Investors monitor these developments closely for strategic insights amid evolving market dynamics.

Bank Nifty: Down by 0.89%

The Bank Nifty initially showed promise with a green opening but closed lower by 0.89%, ending the day in the red at 52,342.25. Similarly, the BSE Sensex experienced a decline of 0.27%, settling at a lower level of 79,032.73 by market close. This downturn reflects cautious investor sentiment and market volatility impacting both banking sector stocks and broader market indices.

In the sectorial front, the Oil & Gas sector showed significant strength, rising by 1.68%. Mahanagar Gas Ltd. led the charge with an impressive gain of 6.76%, showcasing robust performance. Indraprastha Gas Ltd. also contributed positively, climbing by 4.43%.

Conversely, the Financial Services sector faced challenges, emerging as the top loser with a decline of 0.87%. Within this sector, Axis Bank Ltd. experienced a notable drop, losing 1.95%, reflecting market uncertainties. Muthoot Finance Ltd. also saw a decrease, falling by 1.87%.

Foreign Institutional Investors (FII/FPI) recorded a buy value of Rs. 20,605.78 crore and a sale value of Rs. 20,628.87 crore, resulting in a marginal net outflow of Rs. 23.09 crore during the trading session.

Conversely, Domestic Institutional Investors (DII) reported a buy value of Rs. 20,973.40 crore and a sale value of Rs. 14,315.09 crore, leading to a net inflow of Rs. 6,658.31 crore into the market.

Bank Nifty

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

The gainers included Punjab National Bank with a 3.28% increase, Bandhan Bank with a 1.85% increase, Bank of Baroda with a 1.01% increase, AU Bank with a 0.59% increase, and State Bank of India with a 0.57% increase.

On the other hand, the biggest losers in the sector included Axis Bank with a 1.95% decline, ICICI Bank with a 1.86% decline, Kotak Bank with a 1.51% decline, IndusInd Bank with a 1.48% decline, and HDFC Bank with a 0.66% decline. These results suggest that some of the banking stocks performed better for the day.

Gold and Silver

Today 22 Carat Gold Price Per Gram in India (INR)

Today 24 Carat Gold Price Per Gram in India (INR)

Today Silver Price 1 Gram/KG in India (INR)

Stocks Highlights

Dr. Reddy’s Laboratories Ltd. witnessed a share price increase of 2.63%, rising from its previous close of Rs 6,235.90 to a last traded price of Rs 6,400.00. Intraday analysis reveals that in the past 19 years, only 1.07% of trading sessions have seen intraday gains surpassing 5%. The company’s Return on Equity (ROE) for the year ending March 31, 2024, was an impressive 19.74%, outperforming its five-year average of 15.62%.

In terms of expenses, Dr. Reddy’s Laboratories Ltd. allocated less than 1% of its operating revenues to interest expenses and 17.96% to employee costs for the same period. However, the stock’s three-year return of 19.4% trails behind the Nifty 100’s return of 52.57%.

Axis Bank Ltd.’s share price fell by 1.95%, from a previous close of Rs 1,288.95 to Rs 1,263.80. Despite this decline, the bank’s loan book showed a year-over-year increase of 15.08% in advances, surpassing its five-year compound annual growth rate (CAGR) of 11.38%. Furthermore, the company’s annual revenue growth of 29.99% outpaced its three-year CAGR of 19.29%.

Axis Bank Ltd. also outperformed in stock returns, delivering a three-year return of 74.95%, significantly higher than the Nifty 100’s return of 52.57%. This performance indicates strong financial health and promising growth prospects despite recent share price movements.

Advance Decline Ratio

Today, the advance-decline ratio was 1.19, and the market breadth was positive. The volatility index India Vix decreased by 3.28 to settle at 13.69 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1436
Decliners – 1206
52Wk High – 128
52Wk Low – 18
High Band Hitters – 92
Low Band Hitters – 69
200d SMA – 21425
50d SMA – 22795
20d SMA – 23322

Top Gainers and Losers Stocks

The top gainers were Dr. Reddy (+2.63%), ONGC (+2.56%), Reliance (+2.19%), Hero MotoCorp (+1.91%), and SBI Life (+1.88%).

The top losers were Axis Bank (-1.95%), ICICI Bank (-1.86%), Bharti Airtel (-1.82%), Kotak Bank (-1.51%), and IndusInd Bank (-1.48%).

Top Gainers and Losers Sectors

The top gainers sector were Oil & Gas (+1.68%), Pharma (+1.11%), Realty (+0.53%), Metal (+0.48%), and Consumer Durables (+0.27%).

The top losers sector were Financial Services (-0.87%), and Media (-0.19%).

SECTORS – NOTABLE ACTION
OIL & GAS +1.68%
PHARMA +1.11%
REALTY +0.53%
FINANCIAL SERVICES -0.87%
MEDIA -0.19%

Stocks Ban List

The SEBI F&O segment is currently functioning normally, with no stocks restricted for trading.

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.

Daily Pivots

As per the above pivots data, 23850 to 24250 is the Nifty 50 trading range.

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