Indian Equity Benchmarks Finish Strong Despite Fed Rate Cut Delay

At the close, the Nifty 50 was at 21,929.40 up by 0.72%

The NSE Nifty 50 index started the trading day on a positive note, marking a 0.72 percent increase and maintaining its upward trend throughout the session. Despite concerns surrounding the potential delay in the US Federal Reserve’s rate cuts, Indian equity benchmarks exhibited resilience, closing near their daily highs. Notably, the Nifty surged above 21,900 points, settling at 21,929.40 with gains of 157.70 points, fueled by widespread buying activities.

Investor confidence remained strong despite subdued global cues, with exceptions seen in China and Hong Kong. This confidence largely drove the positive momentum in the market, particularly buoying the Information Technology and Oil & Gas sectors, which recorded gains of 0.7 percent for the Nifty50 index.

Market breadth was moderately positive, reflecting investor caution ahead of the RBI MPC meeting. Expectations of a dovish monetary policy boosted sentiment in the bond market. Additionally, the oil & gas sector saw modest advances amidst geopolitical tensions in the Middle East and expectations of improvements in the weekly US crude inventory.

Although some profit booking occurred at higher levels, the overall market sentiment remained optimistic, with the Nifty50 maintaining a positive stance above the crucial 21,900 level. Investors showed confidence in the market’s ability to weather global uncertainties, driving sustained upward movement.

Bank Nifty: Down by 0.29%

The Bank Nifty kicked off the trading day on a downward trajectory, experiencing a 0.29 percent decline from its opening value. This downward trend persisted, leading the Bank Nifty to conclude the session in the red zone, settling at 45,690.80. In stark contrast, the BSE Sensex showcased an opposing performance, climbing steadily by 0.63 percent throughout the day. The Sensex closed positively, reaching a peak of 72,186.09 and ending in the green.

Among sectors, the Information Technology (IT) sector emerged as a standout performer, witnessing a remarkable surge of 2.92 percent. Key players like HCL Technologies Ltd. saw substantial gains of 4.40 percent, closely followed by Tata Consultancy Services Ltd. with a commendable rise of 3.93 percent. Conversely, the Fast Moving Consumer Goods (FMCG) sector lagged behind, experiencing a slight decline of 0.16 percent. Within this segment, Britannia Industries Ltd. registered a notable loss of -2.14 percent, while ITC Ltd. saw a decline of -1.40 percent.

Foreign Institutional Investors (FIIs/FPIs) displayed a modest net buying behavior, with a total buy value of Rs. 16,944.43 crore and a sell value of Rs. 16,851.91 crore, resulting in a net value of Rs. 92.52 crore. Conversely, Domestic Institutional Investors (DIIs) demonstrated robust buying activity, with a buy value of Rs. 13,822.11 crore and a sell value of Rs. 12,725.85 crore, leading to a significant net value of Rs. 1,096.26 crore.

Bank Nifty

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

The gainers included State Bank of India with a 1.84% increase, Punjab National Bank with a 0.86% increase, ICICI Bank with a 0.42% increase, and Federal Bank with a 0.17% increase. On the other hand, the biggest losers in the sector included Bank of Baroda with a 2.35% decline, Bandhan Bank with a 1.68% decline, IndusInd Bank with a 1.60% decline, Kotak Bank with a 1.01% decline, and Axis Bank with a 0.80% decline. These results suggest that some of the banking stocks not performed better for the day.

Rupee Slips Marginally Against US Dollar Amidst Firm Greenback

The Indian rupee experienced a slight decline of 2 paise against the US dollar, closing at 83.05 (pro) on Tuesday. This dip was attributed to the strength of the American currency against major global counterparts. However, positive sentiments in domestic equity markets and lower global crude prices provided support to the domestic unit.

Starting at 83.03 against the dollar, the rupee reached an intraday low of 83.06 before settling at 83.05, marking a marginal loss compared to the previous day’s close. This follows a 5 paise depreciation against the dollar on Monday.

The dollar index, which measures the greenback’s performance against a basket of six currencies, saw a marginal increase, trading at 104.36. This was influenced by recent macroeconomic data indicating steady growth in the US economy.

On the global front, Brent crude futures, the benchmark for oil prices, saw a decline of 0.24 percent, settling at $77.80 per barrel. This drop in crude prices contributed to the positive sentiment surrounding the rupee.

Despite external pressures, domestic factors such as favorable equity market conditions and subdued oil prices provided resilience to the Indian currency. Investors remain attentive to both global and domestic developments, navigating market fluctuations with a keen eye on emerging opportunities and risks.

Stocks Highlights

Bharat Petroleum Corporation Ltd. (BPCL) witnessed a significant uptick in its share price, rising by 6.22% from the previous close of Rs 574.75 to Rs 610.50. Notably, only a minimal 1.79% of trading sessions in the last 19 years have seen intraday gains higher than 5%, indicating the rarity of such movements. Additionally, BPCL’s impressive 3-year revenue Compound Annual Growth Rate (CAGR) of 35.99% surpasses its 18.13% CAGR, highlighting robust financial performance. Moreover, the company’s prudent allocation of resources is evident as it dedicates less than 1% of its operating revenues to interest expenses and a mere 0.59% towards employee costs.

Conversely, Britannia Industries Ltd. experienced a decline in its share price, dropping by -2.14% from the previous close of Rs 5,124.50 to Rs 5,015.00. Despite this setback, Britannia boasts a Return on Equity (ROE) of 65.69%, surpassing its 5-year average of 45.21%, reflecting strong profitability. Furthermore, its annual revenue growth of 15.02% outperforms the 3-year CAGR of 11.49%. However, a recent sell signal emerged with a 20-day moving average crossover, historically resulting in an average price decline of -2.15% within 7 days, signaling a potential bearish trend ahead. Investors closely monitor these indicators to make informed decisions amid market fluctuations.

Advance Decline Ratio

Today, the advance-decline ratio was 1.64, and the market breadth was positive. The volatility index India Vix increased by 1.07 percent to settle at 15.79 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 1568
Decliners – 955
52Wk High –  243
52Wk Low – 26
High Band Hitters – 168
Low Band Hitters – 72
200d SMA – 19705
50d SMA – 21328
20d SMA – 21667

Top Gainers and Losers Stocks

The top gainers were BPCL (+6.22%), HDFC Life (+5.12%), HCL Technologies (+4.40%), TCS (+3.93%), and Maruti (+3.85%).

The top losers were Power Grid (-2.72%), Britannia (-2.14%), IndusInd Bank (-1.60%), ITC (-1.40%), and Grasim (-1.28%).

Top Gainers and Losers Sector

The top gainers sector were IT (+2.92%), Oil & Gas (+2.67%), Metal (+1.59%), Auto (+1.47%), and Pharma (+1.07%).

The top losers sector were FMCG (-0.16%).

SECTORS – NOTABLE ACTION
IT +2.92%
OIL & GAS +2.67%
METAL +1.59%
FMCG -0.16%

Stocks Ban List

(SEBI) F&O ban list (INDUSTOWER open at -215.05 and close at +221.00), (INDIACEM open at -234.00 and close at +241.05), (UPL open at -476.20 and close at +481.85), (NATIONALUM open at +156.70 and close at +162.75), (HINDCOPPER open at -295.55 and close at +298.05), and (ZEEL open at -178.00 and close at -175.80) 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.

TATACHEM, PEL, BALRAMCHIN, PNB, RBLBANK, GMRINFRA, and ABFRL stocks has the possibilities of entrance in the ban list.

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

Daily Pivots

As per the above pivots data, 21750 to 22100 is the Nifty 50 trading range.

Read previous -Daily Insights- here
Nifty Dips Below 21,800, Market Fails to Sustain Gains
Nifty Hits All-Time High as Oil & Gas Sector Shines, Banks Lag Behind
Volatile Trading Day for Nifty 50 Amidst Interim Budget and Global Sentiments

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