Market Soars with Steady Gains Sector-Wide Buying Keeps Momentum Alive

At the close, the Nifty 50 was at 19,811.35 up by 0.62%

The equity markets had a strong opening, maintaining their momentum throughout the trading session. The NSE Nifty 50 started the day on a positive note, showing a 0.62 percent increase and ultimately closing in the green, comfortably above the 19,800 mark. This upward trend was driven by favorable global market conditions and robust buying activity across various sectors.

Investors expressed confidence regarding the Middle East conflict, expecting it to remain localized without a significant impact on crude oil prices. Additionally, dovish statements from the US Federal Reserve led to a decrease in the US 10-year bond yield.

In the upcoming months, there are high hopes for a moderation in the September India Consumer Price Index (CPI) due to declining food and fuel inflation. The eagerly anticipated Q2 earnings season is commencing with the IT sector, which has modest expectations, while broader corporations are expected to report strong results, potentially boosting market sentiment.

The global macroeconomic landscape has once again taken the spotlight as oil prices stabilize amidst ongoing geopolitical tensions. If US Treasury yields remain stable, it is likely to instill confidence in global equity markets, encouraging investors to adopt a risk-on approach. Positive global signals and steady yields are contributing to the recent upward trajectory of the market.

Bank Nifty: Up by 0.35%

The financial markets exhibited notable trends during the trading day, witnessing significant gains in both the Bank Nifty and BSE Sensex. The Bank Nifty began the day positively, recording a 0.35 percent increase and continued to strengthen, closing at 44,516.90. Simultaneously, the BSE Sensex posted a substantial gain of 0.60 percent, reaching a closing high of 66,473.05.

In the sectoral landscape, the Auto sector stood out with remarkable gains, surging by 0.92 percent. Notably, Hero Motocorp Ltd. experienced a substantial rise of 4.04 percent, while Samvardhana Motherson International Ltd. recorded a gain of 2.14 percent, highlighting the sector’s strong performance. However, the Information Technology (IT) sector witnessed a slight decline, with a marginal loss of 0.07 percent. HCL Technologies Ltd. faced a reduction of -1.65 percent, and LTI Mindtree Ltd. reported a minor loss of -0.58 percent.

In terms of foreign institutional investment (FII/FPI), the buy value amounted to 12,526.94 crores, while the sale value reached 12,948.71 crores, resulting in a net value of -421.77 crores. This indicates that during the specified period, FII/FPI acted as net sellers, divesting more than they invested.

Conversely, domestic institutional investors (DII) exhibited a different trend, with a buy value of 8,369.48 crores and a sale value of 7,337.46 crores, resulting in a net value of 1,032.02 crores. The DII acted as net buyers, demonstrating a positive net investment.

Bank Nifty

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

The gainers included IDFC First Bank with a 1.44% increase, Punjab National Bank with a 1.13% increase, HDFC Bank with a 1.12% increase, Kotak Bank with a 1.02% increase, and Axis Bank with a 0.51% increase. On the other hand, the biggest losers in the sector included Bank of Baroda with a 3.22% decline, Bandhan Bank with a 1.37% decline, Federal Bank with a 0.88% decline, State Bank of India with a 0.46% decline, and IndusInd Bank with a 0.07% decline. These results suggest that some banking stocks performed better for the day.

Buzz

Indian Rupee Strengthens Amid Domestic Optimism and Global Factors

The Indian rupee demonstrated resilience for the second consecutive day, gaining 7 paise and closing at 83.18 (pro) against the US dollar on Wednesday. This positive trend was primarily attributed to robust buying in domestic equities and the weakening of the American currency in international markets.

Despite these favorable domestic factors, the rupee faced challenges as foreign institutional investors continued their persistent withdrawal of funds, exerting downward pressure on the domestic currency.

In the interbank foreign exchange market, the rupee opened at 83.20 and traded within a range of 83.15 to 83.24 against the US dollar before ultimately closing at 83.18 (pro), marking a gain of 7 paise from its previous close.

Looking ahead, the rupee is expected to maintain a modestly positive trajectory, driven by increasing global risk appetite and the softened stance of the US dollar, influenced by dovish comments from US Federal Reserve officials. However, geopolitical uncertainties arising from the ongoing Israel-Hamas conflict may act as a limiting factor, preventing a sharp increase in the currency’s value.

On the global front, Brent crude futures, the benchmark for global oil prices, experienced a slight decline of 0.65 percent, settling at $87.08 per barrel. These developments underscore the importance of monitoring both domestic and international factors to gain a comprehensive understanding of the rupee’s performance.

Buzzing

Hero MotoCorp Ltd. witnessed a substantial upswing, with its share price surging by 4.04 percent from the previous close of Rs 2,976.80 to reach Rs 3,097.15. Notably, a significant development occurred on October 9, 2023, as a 50-day moving average crossover took place. It’s worth mentioning that, historically, a 50-day moving average crossover signal resulted in an average price decline of -3.89% within 30 days in the last five years. Nevertheless, the company’s annual revenue growth of 15.35% outperformed its 3-year compound annual growth rate (CAGR) of 4.97%, indicating robust performance. It’s interesting to note that over the last 18 years, only 1.39% of trading sessions saw intraday gains higher than 5%, highlighting the rarity of such occurrences.

On the other hand, HCL Technologies Ltd. experienced a decline in its share price, dropping by -1.65% from the previous closing value of Rs 1,261.80 to Rs 1,241.00. A 20-day moving average crossover was observed on October 9, 2023. Historical data suggests an average price gain of 2.5% within seven days of this signal over the last five years. However, the company reported a quarter-on-quarter (QoQ) revenue decline of 1.55%, marking its lowest in the past three years.

Advance Decline Ratio

Today, the advance-decline ratio was 1.98, and the market breadth was positive. The volatility index India Vix decreased by 2.52 percent to settle at 10.99 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1599
Decliners – 807
52Wk High –  137
52Wk Low – 10
High Band Hitters – 136
Low Band Hitters – 39
200d SMA – 18538
50d SMA – 19606
20d SMA – 19760

Top Gainers and Losers Stocks

The top gainers were Hero MotoCorp (+4.04%), Grasim (+3.31%), Wipro (+3.27%), UltraTech Cement (+2.10%), and Reliance  (+1.62%).

The top losers were HCL Technologies (-1.65%), Coal India (-0.64%), LTIM (-0.58%), SBIN (-0.46%), and TCS (-0.44%).

Top Gainers and Losers Sector

The top gainers sector were Auto (+0.92%), FMCG (+0.87%), Media (+0.86%), Realty (+0.84%), and Oil & Gas  (+0.73%).

The top losers sector were IT (-0.07%).

SECTORS – NOTABLE ACTION
AUTO +0.92%
FMCG +0.87%
MEDIA +0.86%
IT -0.07%

Stocks Ban List

(SEBI) F&O ban list (MCX open at +2136.00 and close at +2156.55), (L&TFH open at +134.35 and close at -132.85), (IBULHSGFIN open at +177.50 and close at +177.85), (PNB open at +75.80 and close at +76.05), (MANAPPURAM open at +145.50 and close at +145.15), and (DELTACORP open at +144.05 and close at +142.95) 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, BALRAMCHIN, ESCORTS, BHEL, SAIL, SUNTV, RBLBANK, and NMDC stock has the possibilities of enterance in the ban list.

DELTACORP stock has the possiblities of exit from ban list.

Daily Pivots

As per the above pivots data, 19750 to 19860 is the Nifty 50 trading range.

Read previous -Daily Insights- here
Market Bounces Back as Dollar and Treasury Yields Take a Dive
Geopolitical Tensions Weigh on Indian Equity Markets
Market Soars RBI Meeting Outcome Sparks Positive Start!

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