Market Soars to Record Highs, Then Plummets—What’s Next?

At the close, the Nifty 50 was at 24,123.85 down by 0.07%

The NSE Nifty 50 exhibited a mixed performance on July 2, starting positively but closing with a marginal loss of 18 points, ending at 24,123.85. This slight decline formed a small red candle on the daily chart, signaling potential exhaustion among bullish investors at recent peaks.

During the trading session, Nifty reached an all-time high of 24,236.35 but faced resistance in sustaining this upward momentum. The market experienced fluctuating movements, with initial gains followed by selling pressure in the latter half, briefly dragging Nifty near 24,050 before a modest recovery by closing time.

Despite the day’s minor setback, the overall trend for Nifty remains positive, supported by a pattern of higher tops and bottoms. Market analysts suggest that any further consolidation or minor dips could present buying opportunities, anticipating a resumption of upward momentum in the near future.

In sectoral trends, IT stocks saw gains fueled by anticipated increases in discretionary spending, contrasting with declines in auto stocks due to lower-than-expected monthly volumes. Investor sentiment remains cautious amidst global economic factors such as the ECB’s stance on rate cuts, developments in the US election, and fluctuating US Treasury yields and crude oil prices.

The domestic market’s resilience amid global uncertainties underscores its dynamic nature and resilience. Investors are advised to monitor upcoming events like the monsoon progress, the Union budget, and global economic indicators, as these factors could influence market trends significantly in the coming weeks. Despite short-term fluctuations, the bullish outlook for Nifty remains intact, offering potential opportunities for strategic investment decisions.

Bank Nifty: Down by 0.77%

The Bank Nifty commenced trading on a positive note but concluded with a decline of 0.77%, closing at 52,168.10. The index faced selling pressure throughout the day, leading to its downward trajectory by the session’s end.

Similarly, the BSE Sensex opened marginally in the green but closed with a slight decrease of 0.04%, settling at 79,441.45. The index experienced fluctuations, with trading activities largely influenced by sectoral performances and external market factors.

In the sectorial front, the Information Technology (IT) sector has demonstrated robust performance, marking a notable gain of 1.17%. Leading this upward trend, Coforge Ltd. saw a significant rise of 2.74%, followed closely by Wipro Ltd. with a gain of 2.09%.

Conversely, the Fast-Moving Consumer Goods (FMCG) sector faced challenges, registering a decline of 0.85%. Marico Ltd. experienced a notable loss of -2.88%, reflecting market pressures, while Godrej Consumer Products Ltd. also saw a decline of -1.94%.

FII/FPI entities recorded a buy value of Rs. 14,551.15 crore and a sell value of Rs. 16,551.27 crore, resulting in a net outflow of Rs. 2,000.12 crore.

In contrast, Domestic Institutional Investors (DII) participated actively with a buy value of Rs. 14,203.40 crore and a sell value of Rs. 13,555.15 crore, leading to a net inflow of Rs. 648.25 crore.

Bank Nifty

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

The gainers included HDFC Bank with a 1.34% increase.

On the other hand, the biggest losers in the sector included Bank of Baroda with a 2.55% decline, IDFC First Bank with a 2.53% decline, Kotak Bank with a 2.49% decline, IndusInd Bank with a 1.78% decline, and State Bank of India with a 1.70% decline. These results suggest that most of the banking stocks not 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)

Rupee Wobbles: Will a Stronger Dollar and Oil Prices Push it Under?

The rupee depreciated 12 paise to 83.56 against the US dollar in early trade on Tuesday, pressured by the strengthening of the American currency in international markets and rising crude oil prices.

What Led to the Rupee’s Fall?
Oil importers and foreign portfolio investors (FPIs) purchased US dollars as US yields increased, weakening the local unit. The rupee opened at 83.51 in the interbank foreign exchange market and fell to 83.56 against the greenback, marking a 12 paise decline from its previous close. On Monday, the rupee had already dropped 10 paise, settling at 83.44 against the dollar.

Market Dynamics and the Rupee
The rupee saw dollar inflows and rose to 83.37 on Monday, but was sold off to 83.44 due to oil importers and FPIs buying dollars amid rising US yields. The dollar index, which measures the greenback’s strength against a basket of six currencies, traded at 105.91, up by 0.02%, driven by a surge in US treasury yields as investors speculated on a second Trump presidency. Brent crude futures, the global oil benchmark, increased by 0.22% to USD 86.80 per barrel.

Stocks Highlights

Larsen & Toubro Ltd. (L&T) demonstrated robust performance in recent trading sessions, with its share price increasing by 2.73% to reach Rs 3,623.00 from its previous close of Rs 3,526.55. Notably, only 1.09% of its trading sessions in the last 19 years saw intraday declines higher than 5%, indicating stability in its market behavior.

L&T’s annual revenue growth has been impressive, boasting a Compound Annual Growth Rate (CAGR) of 20.94% over the past three years, outperforming its 3-year CAGR of 17.16%. The company has maintained prudent financial management, allocating 1.6% of its operating revenues towards interest expenses and 18.62% towards employee costs for the fiscal year ending March 31, 2024.

Conversely, Shriram Finance Ltd. experienced a decline in its share price by -2.95%, falling to Rs 2,838.00 from Rs 2,924.25. The company faced volatility in trading, with only 3.4% of its trading sessions in the last 19 years showing intraday gains higher than 5%.

Despite recent challenges, Shriram Finance Ltd. has shown bullish signals, such as a recent 5-day moving average crossover, historically resulting in an average price gain of 4.19% within seven days. Additionally, the company has delivered impressive stock returns, achieving a 3-year return of 103.49%, significantly outpacing the Nifty 100 index, which returned 52.57% over the same period.

Advance Decline Ratio

Today, the advance-decline ratio was 1.06, and the market breadth was positive. The volatility index India Vix decreased by 1.37 to settle at 13.64 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1369
Decliners – 1296
52Wk High – 231
52Wk Low – 15
High Band Hitters – 165
Low Band Hitters – 49
200d SMA – 21471
50d SMA – 22877
20d SMA – 23446

Top Gainers and Losers Stocks

The top gainers were Larsen & Toubro (+2.73%), Wipro (+2.09%), Infosys (+1.84%), Tata Consumer (+1.41%), and HDFC Bank (+1.34%).

The top losers were Shriram Finance (-2.95%), Kotak Bank (-2.49%), Bharti Airtel (-2.40%), Tata Motors (-1.95%), and IndusInd Bank (-1.78%).

Top Gainers and Losers Sectors

The top gainers sector were IT (+1.17%), Media (+1.05%), Realty (+0.83%), Oil & Gas (+0.26%), and Pharma (+0.14%).

The top losers sector were FMCG (-0.85%), Auto (-0.76%), Financial Services (-0.55%), Metal (-0.48%), and Consumer Durables (-0.38%).

SECTORS – NOTABLE ACTION
IT +1.17%
MEDIA +1.05%
REALTY +0.83%
FMCG -0.85%
AUTO -0.76%
FINANCIAL SERVICES -0.55%

Stocks Ban List

(SEBI) F&O ban list (INDIACEM open at -284.80 and close at +284.45), and (INDUSTOWER open at +391.60 and close at -383.80) 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.

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

Daily Pivots

As per the above pivots data, 23900 to 24350 is the Nifty 50 trading range.

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