IT Stocks Drive Indices Despite Weak Global Cues

At the close, the Nifty 50 was at 21,710.80 up by 0.24%

The NSE Nifty 50 index exhibited robust performance, initiating positively and sustaining an upward trend to culminate with a 0.24% increase at the session’s close. Throughout the trading day, hovering around the 21,700 mark, the indices notably maintained their winning streak for the second consecutive day. This commendable growth was largely underpinned by strong buying activities witnessed within the Capital Goods and Information Technology sectors.

Amidst intermittent volatility, Indian equity benchmarks concluded the first week of the year on a positive note. The notable climb was primarily fueled by significant buying interest observed in information technology stocks. Commencing with initial gains as the Nifty50 index opened higher at approximately 21,750, the day encountered fluctuations, briefly losing intraday gains mid-session. However, a late-hour resurgence propelled the index marginally above the 21,700 threshold by the market’s close.

Global market closure mirrored the day’s trends, influenced by the upsurge in the US 10-year yield and speculation surrounding the impending release of US payroll data, impacting expectations for the Federal Reserve’s policy outlook. Moreover, investor caution prevailed ahead of eurozone inflation data.

The forthcoming earnings season is anticipated to test market optimism against December quarter earnings. Market sentiment remains vigilant, keenly observing how these financial reports align with current valuations and their potential influence on future market trajectories.

Bank Nifty: Down by 0.08%

The Bank Nifty commenced positively, initially observing an uptick but eventually concluded the session with a marginal decline of 0.08%, settling at a closing figure of 48,159.00. In contrast, the BSE Sensex charted a different trajectory, opening with a 0.25% increase and sustaining its upward momentum throughout the trading day. The Sensex closed on a high note at 72,026.15, reflecting its positive performance.

In sectorial movements, the IT sector exhibited a promising rise of 1.29%, showcasing strong performances by leading companies. Notably, Coforge Ltd. surged significantly by 2.12%, positioning itself as a frontrunner. Similarly, Tata Consultancy Services Ltd. demonstrated commendable growth with an increase of 1.96%, contributing to the sector’s overall positive trajectory.

Contrarily, the Pharma sector faced a decline, marking a dip of 0.31% in its valuation. Granules India Ltd. experienced a notable downturn of -1.52%, indicating challenges within the pharmaceutical domain. Additionally, Divi’s Laboratories Ltd. saw a decrease of -0.99%, highlighting the sector’s recent struggles.

Foreign Institutional Investors/Foreign Portfolio Investors (FII/FPI) displayed a positive sentiment with a net investment of Rs. 1,696.86 Crores. Their buy value amounted to Rs. 12,677.19 Crores against a sale value of Rs. 10,980.33 Crores.

Conversely, Domestic Institutional Investors (DII) showed a contrasting trend, depicting a net divestment valued at -Rs. 3,497.62 Crores. Their buy value totaled Rs. 9,796.37 Crores, notably lower than the sale value of Rs. 13,293.99 Crores.

Bank Nifty

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

The gainers included Axis Bank with a 0.97% increase, ICICI Bank with a 0.55% increase, and AU Bank with a 0.14% increase. On the other hand, the biggest losers in the sector included Bandhan Bank with a 3.37% decline, Bank of Baroda with a 1.47% decline, Kotak Bank with a 1.01% decline, HDFC Bank with a 0.70% decline, and IndusInd Bank with a 0.52% decline. These results suggest that some of the banking stocks not performed better for the day.

Indian Rupee Gains Ground Against Dollar Amidst Asian Market Fluctuations

The Indian rupee concluded the week on a stronger note against the US dollar, supported by steady dollar inflows. Despite a slip observed among its Asian counterparts, the rupee closed at 83.15 against the dollar, marking a 0.1% increase from its previous session’s closure at 83.23. Maintaining relative stability, the local unit remained largely unchanged week-on-week.

In contrast to several Asian currencies, the rupee showcased a robust start in 2024. While most regional currencies experienced declines on Friday, the rupee stood firm, benefitting from dollar gains triggered by recalibrated expectations around potential rate cuts in the United States.

This resilient performance positions the Indian rupee favorably amidst broader Asian market fluctuations. The currency’s ability to hold its ground and maintain stability against the dollar, despite regional variations, underscores its relative strength and resilience in the current economic landscape. As global market dynamics continue to evolve, the rupee’s performance against the dollar remains an important indicator for investors and market participants, influencing trade sentiments and economic strategies within the region.

Stocks Highlights

Larsen & Toubro Ltd. Positive Momentum, Strong Revenue Growth

Larsen & Toubro Ltd. witnessed a notable 2.60% surge in its share price, climbing from the previous closing figure of Rs 3,458.70 to Rs 3,548.60. In the context of its trading history, only a mere 1.35% of sessions over the last 19 years saw intraday gains surpassing 5%, highlighting the rarity of such substantial increases. Recently, a 14-day moving crossover signaled a potential buy opportunity, historically resulting in an average gain of 3.01% within 7 days thereafter over the past 5 years.

Fundamentally, the company’s financial performance showcases commendable strength. Larsen & Toubro demonstrated an impressive 17.31% annual revenue growth, surpassing its 3-year compound annual growth rate (CAGR) of 7.93%. However, its expenditure revealed that 1.75% of operating revenues were directed towards interest expenses, while 20.3% was allocated to employee costs for the fiscal year ending 31st March 2023.

Britannia Industries Ltd. Mixed Market Performance, Robust Metrics

Conversely, Britannia Industries Ltd. experienced a -1.62% decline in its share price, sliding from the previous closing of Rs 5,361.30 to Rs 5,274.50. Similar to Larsen & Toubro, only 1.42% of trading sessions in the past 19 years witnessed intraday gains exceeding 5%. Notably, a 5-day moving crossover signaled a bullish trend, historically resulting in an average gain of 2.32% within 7 days subsequently over the last 5 years.

Britannia Industries showcased a strong Return on Equity (ROE) of 65.69% for the fiscal year ending 31st March 2023, surpassing its 5-year average of 45.21%. Moreover, the company exhibited a commendable annual revenue growth of 15.02%, outperforming its 3-year CAGR of 11.49%.

Advance Decline Ratio

Today, the advance-decline ratio was 1.11, and the market breadth was positive. The volatility index India Vix decreased by 5.25 percent to settle at 12.63 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 1316
Decliners – 1183
52Wk High –  261
52Wk Low – 5
High Band Hitters – 154
Low Band Hitters – 33
200d SMA – 19249
50d SMA – 20378
20d SMA – 21398

Top Gainers and Losers Stocks

The top gainers were Adani Ports (+2.65%), Larsen & Toubro (+2.60%), TCS (+1.96%), SBI Life (+1.60%), and LTIM (+1.37%).

The top losers were Britannia (-1.62%), Nestle India (-1.61%), JSW Steel (-1.04%), Kotak Bank (-1.01%), and Divi’s Laboratories (-0.99%).

Top Gainers and Losers Sector

The top gainers sector were IT (+1.29%), Auto (+0.44%), Realty (+0.36%), Oil & Gas (+0.26%), and Consumer Durables (+0.20%).

The top losers sector were Pharma (-0.31%), Metal (-0.14%), FMCG (-0.06%), and Financial Services (-0.01%).

SECTORS – NOTABLE ACTION
IT +1.29%
AUTO +0.44%
REALTY +0.36%
PHARMA -0.31%
METAL -0.14%
FMCG -0.06%

Stocks Ban List

(SEBI) F&O ban list (INDIACEM open at +274.85 and close at -265.45), (CHAMBLFERT open at -388.00 and close at -372.80), (GNFC open at +800.00 and close at -762.65), (ESCORTS open at -2858.45 and close at -2804.85), (DELTACORP open at +156.00 and close at -152.30), (NATIONALUM open at +131.45 and close at -128.10), (SAIL open at +119.50 and close at -116.95), (ZEEL open at +292.00 and close at -283.05), (BALRAMCHIN open at +409.85 and close at -403.50), (IEX open at +166.85 and close at -164.20), and (HINDCOPPER open at +280.70 and close at +283.30) 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.

PEL, BHEL, and INDUSTOWER stocks has the possibilities of entrance in the ban list.

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

Daily Pivots

As per the above pivots data, 21600 to 21800 is the Nifty 50 trading range.

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