Infosys and TCS Drive Indian Equity Indices to All-Time Highs

At the close, the Nifty 50 was at 21,894.55 up by 1.14%

In a surprising turn of events, the NSE Nifty 50 demonstrated its resilience by opening with a notable 1.14% gain, eventually settling at an impressive level near 21900 on January 12. This unprecedented surge was chiefly fueled by stellar quarterly performances from IT behemoths Infosys and TCS, injecting vigor into the market.

In light of restrained international indicators, Indian equity indices started the day on a positive note with a gap-up opening, extending gains across various sectors, excluding auto and pharma. This broad-based surge, amidst mixed global signals, underscores the market’s robustness in the face of economic fluctuations.

Buoyed by the positive outcomes from TCS and Infosys, Indian stocks are poised for a favorable opening, aligning with a rebound in US markets following initial concerns about rising inflation. This bullish trend hints at the market’s ability to weather global challenges, showcasing its resilience.

The driving force behind this bullish rally lies in the robust performance of IT leaders, suggesting a potential sectoral recovery and an improved outlook for BFSI in FY25. The synergy between PSU banking stocks and the prevailing business cycle further emphasizes the strength of the upward trajectory in Indian markets. Investors are now eyeing this momentum as an opportunity for strategic entries, aligning with the positive shift in market dynamics.

Bank Nifty: Up by 0.57%

In a promising start, the Bank Nifty exhibited a 0.57% uptick, maintaining positive momentum throughout the day and closing at 47,709.80, solidifying the optimistic trend. Simultaneously, the BSE Sensex outperformed, surging by 1.18% and closing impressively high at 72,568.45, marking a substantial upward movement.

The Information Technology (IT) sector stole the spotlight with a remarkable surge of 5.14%. Infosys Ltd. led the charge with an impressive 8.08% gain, closely followed by Coforge Ltd. with a substantial 5.71% increase. In contrast, the Media sector experienced a dip, recording a 0.65% loss. Notable setbacks included Network18 Media & Investments Ltd. with a -5.12% decline and Dish TV India Ltd. with a -4.62% decrease.

Foreign Institutional Investors (FII/FPI) took a net selling position, with a sale value of Rs. 12,244.29 Cr., surpassing the buy value of Rs. 11,904.24 Cr., resulting in a net value of -Rs. 340.05 Cr. On the flip side, Domestic Institutional Investors (DII) demonstrated a net buying trend, with a buy value of Rs. 13,152.89 Cr., exceeding the sale value of Rs. 10,241.70 Cr., leading to a positive net value of Rs. 2,911.19 Cr. This dual trend indicates a dynamic market with diverse investor sentiments.

Bank Nifty

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

The gainers included Punjab National Bank with a 3.11% increase, State Bank of India with a 2.43% increase, Bank of Baroda with a 1.70% increase, AU Bank with a 1.47% increase, and ICICI Bank with a 1.09% increase. On the other hand, the biggest losers in the sector included Bandhan Bank with a 1.20% decline, Axis Bank with a 0.60% decline, and HDFC Bank with a 0.31% decline. These results suggest that most of the banking stocks performed better for the day.

Rupee’s Winning Streak Halts Amidst Global Economic Shifts

In a surprising turn of events, the Indian rupee experienced a setback, depreciating by 4 paise to 83.05 against the US dollar. The seven-day winning streak came to an end as foreign investors hurriedly withdrew funds amidst a notable surge in crude oil prices, impacting global markets.

Despite a weakening US dollar and robust equity markets, the overall sentiment took a hit following the release of US data revealing a higher-than-expected increase in inflation for December. This development dampened hopes of an imminent interest rate cut by the Federal Reserve, contributing to the rupee’s decline.

At the interbank foreign exchange, the domestic currency opened weak at 83.08 and extended its losses to touch 83.10 against the greenback. Eventually, it settled at 83.05, marking a 4 paise loss from its previous close.

Thursday saw the rupee settling 2 paise higher at 83.01, culminating a seven-session winning streak that had added 31 paise since January 2.

Simultaneously, the dollar index, measuring the greenback’s strength against a basket of six currencies, traded 0.07% lower at 101.95. This scenario unfolded alongside Brent crude futures surging by 1.83% to USD 78.83 per barrel.

Stocks Highlights

Infosys Ltd. experienced a noteworthy surge, with its share price increasing by 8.08% to Rs 1,615.00 from its previous close of Rs 1,494.20. The company’s annual revenue growth stands out, boasting an impressive 20.6%, surpassing its 3-year CAGR of 16.7%. However, caution may be warranted as a sell signal emerged with a 20-day moving crossover on Jan 10, 2024, historically leading to an average price decline of -2.12% within 7 days. Notably, Infosys managed its expenses efficiently, allocating less than 1% of operating revenues to interest expenses and 53.39% to employee costs in the year ending March 31, 2023.

On the contrary, Bajaj Finserv Ltd. witnessed a slight decline, with its share price decreasing by -1.02% to Rs 1,652.30 from the previous close of Rs 1,669.25. Despite this, the company exhibited strong annual revenue growth of 19.92%, surpassing its 3-year CAGR of 14.57%. A unique aspect is the infrequency of intraday declines higher than 5%, occurring in only 1.94% of trading sessions in the last 15 years. Bajaj Finserv’s expenditure distribution reveals a prudent approach, allocating 14.87% of operating revenues to interest expenses and 10.68% to employee costs in the year ending March 31, 2023.

Advance Decline Ratio

Today, the advance-decline ratio was 1.14, and the market breadth was positive. The volatility index India Vix increased by 2.46 percent to settle at 13.08 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1328
Decliners – 1168
52Wk High –  265
52Wk Low – 7
High Band Hitters – 136
Low Band Hitters – 53
200d SMA – 19364
50d SMA – 20638
20d SMA – 21560

Top Gainers and Losers Stocks

The top gainers were Infosys (+8.08%), ONGC (+5.74%), Tech Mahindra (+4.69%), HCL Technologies (+4.65%), and LTIM (+4.63%).

The top losers were Cipla (-1.20%), Apollo Hospitals (-1.06%), Bajaj Finserv (-1.02%), UltraTech Cement (-0.99%), and Power Grid (-0.95%).

Top Gainers and Losers Sector

The top gainers sector were IT (+5.14%), Realty (+1.80%), Oil & Gas (+1.47%), Consumer Durables (+0.67%), and FMCG (+0.46%).

The top losers sector were Media (-0.65%), Auto (-0.21%), and Pharma (-0.19%).

SECTORS – NOTABLE ACTION
IT +5.14%
REALTY +1.80%
OIL & GAS +1.47%
MEDIA -0.65%
AUTO -0.21%
PHARMA -0.19%

Stocks Ban List

(SEBI) F&O ban list (POLYCAB open at -3910.00 and close at +3980.90), (ZEEL open at -253.60 and close at -249.95), (DELTACORP open at -155.05 and close at -152.15), (HINDCOPPER open at -266.10 and close at -262.50), (BHEL open at -198.00 and close at -196.45), (PVRINOX open at -1537.00 and close at -1526.45), (BANDHANBNK open at +234.90 and close at -230.15), (INDUSTOWER open at +215.90 and close at +216.40), (INDIACEM open at -259.00 and close at +258.20), (ESCORTS open at +2865.00 and close at +2876.35), (PEL open at +945.90 and close at -932.90), (NATIONALUM open at +131.90 and close at +131.45), and (SAIL open at -114.00 and close at +114.90) 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.

BIOCON, GNFC, ASHOKLEY, ABFRL, RBLBANK, and UPL stocks has the possibilities of entrance in the ban list.

PEL, NATIONALUM, and SAIL stocks has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 21700 to 22050 is the Nifty 50 trading range.

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