Nifty on the Edge: Will It Break Above 25,000? Is the Market Preparing for a Major Shift Amid Positive Global Cues?

At the close, the Nifty 50 was at 24,998.45 up by 0.07%

Today, the NSE Nifty 50 opened on a positive note, gaining 0.07% and closing just shy of the 25,000 mark. The benchmark equity index ended its Thursday session in green territory, but not without its share of ups and downs.

Despite the early optimism fueled by positive global cues, the Nifty struggled to maintain its higher intraday levels. As the day progressed, it settled with marginal gains, led primarily by advances in metal and banking stocks. Closing at 24,998.45, Nifty recorded a modest increase of 16.50 points.

Could this be the calm before a storm? The index opened strong but couldn’t sustain the momentum, hovering within a tight range. However, daily charts indicate that Nifty is in the process of retracing a 1,500-point fall, suggesting that the journey isn’t over yet. Analysts believe there’s still potential for upside, targeting levels between 25,350 and 25,500. This consolidation phase could be a golden opportunity for savvy investors.

As we entered the weekly expiry day, Nifty maintained its morning gains but ultimately remained range-bound for the session. The India VIX, often referred to as the fear index, saw a 4.65% decline to 13.47, signaling a decrease in market volatility and favoring the bulls.

A Volatile Yet Directionless Day for Nifty 50

The Nifty 50 wrapped up its day of volatile trading on October 10, inching up moderately after failing to stay above the 50-day Exponential Moving Average (EMA) at 25,050. For a robust rally to materialize, a strong close above this key level is crucial. Until then, the index is likely to continue its consolidation with support found in the 24,900-24,800 range.

Meanwhile, the broader market exhibited mixed sentiments as expectations for Q2 FY25 results seem subdued. Trading activity reflected a negative bias ahead of the earnings season, with the Asian markets initially showing promise but failing to hold their gains. The European markets followed suit, reflecting a negative trend, largely influenced by rising global bond yields and anticipations surrounding the key US inflation data.

Are Domestic Investors the Key to Stability?

Despite these fluctuations, most market experts express a positive outlook for the Indian market, bolstered by substantial support from domestic investors. There’s a growing sentiment that India’s reliance on Foreign Institutional Investors (FIIs) is diminishing.

In recent trading sessions, domestic investors—both institutional and retail—have showcased their growing influence, even as foreign counterparts were seen offloading shares aggressively. Between September 30 and October 4, FIIs sold shares worth around Rs. 39,964 crore, with October 3 marking the most significant sell-off at Rs. 14,854 crore.

Final Thoughts: What Should Investors Do?

As the market navigates through this cautious phase, one has to wonder: Is this the time to buy? With analysts pointing towards potential upside and diminishing volatility, it could be worth keeping an eye on developments. Will Nifty 50 break free from its current range, or is consolidation the name of the game for now? Only time will tell.

Bank Nifty: Up by 1.03%

The Bank Nifty opened with a bang, gaining 1.03%, and maintained its momentum throughout the day, closing at a solid 51,530.90. This upward movement has investors buzzing—could it be the start of a bigger rally? Not to be left behind, the BSE Sensex also saw a modest rise of 0.18%, closing at an all-time high of 81,611.41.

In the sectorial front, the Financial Services sector stole the spotlight with a remarkable gain of 0.93%. This boost was led by heavy hitters like Kotak Mahindra Bank Ltd., which surged by an impressive 3.84%. REC Ltd. also contributed significantly to the sector’s positive momentum, posting a gain of 2.08%.

The Pharma sector faced a different fate, emerging as the top loser with a notable decline of 2.01%. Within this struggling space, Lupin Ltd. saw a sharp fall, tumbling by 5.58%, while Cipla Ltd. followed closely, dropping by 3.37%.

FIIs recorded a buy value of Rs. 16,514.30 crore, while their sale value reached Rs. 21,440.91 crore. This resulted in a net outflow of Rs. 4,926.61 crore.

DIIs demonstrated a more optimistic approach. With a buy value of Rs. 13,301.19 crore and a sale value of Rs. 9,422.86 crore, they achieved a net inflow of Rs. 3,878.33 crore.

Bank Nifty

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

The gainers included Kotak Bank with a 3.84% increase, HDFC Bank with a 1.71% increase, IndusInd Bank with a 1.51% increase, IDFC First Bank with a 1.27% increase, and Axis Bank with a 1.16% increase.

On the other hand, the biggest losers in the sector included AU Bank with a 0.61% decline, Bank of Baroda with a 0.41% decline, Punjab National Bank with a 0.29% decline, Canara Bank with a 0.24% decline, State Bank of India with a 0.05% decline. These results suggest that some of the banking stocks performed better for the day.

Gold and Silver Rate (INR) 10th October, 2024

Rupee Holds Steady Amid Market Fluctuations: What’s Next?

The Indian rupee ended the trading session flat on Thursday, closing at 83.9675 against the U.S. dollar, a minor shift from its previous close of 83.9625. Throughout the day, the currency oscillated within a narrow band of just 2 paisa, demonstrating resilience amid pressure from foreign banks’ dollar bids and a general weakness in Asian currencies. This stability can be attributed to likely interventions by the Reserve Bank of India (RBI), which helped the rupee maintain its ground as markets awaited critical U.S. inflation data.

Investor sentiment has shifted towards the U.S. dollar and bond yields, fueled by expectations of a less aggressive monetary easing cycle from the Federal Reserve. On Thursday, the yield on the 10-year U.S. Treasury rose to 4.08%, marking its highest level since July 30. This uptick in yields reflects changing perceptions about the Fed’s future rate-cutting strategies and has led to a decline in dollar-rupee forward premiums.

Recent policy changes by the RBI have also played a significant role in shaping the currency market landscape. On Wednesday, the central bank adopted a “neutral” stance, contributing to a more cautious approach among investors as they navigate through upcoming economic indicators.

As the market braces for the upcoming U.S. inflation data, many are left wondering: will the rupee maintain its stability, or could external pressures lead to unexpected volatility?

Stocks Highlights

Kotak Mahindra Bank shook up the market today with a sharp 3.84% surge, closing at Rs. 1,870.00, up from Rs. 1,800.80. This isn’t just a one-day wonder—there’s real strength behind the numbers.

Here’s a fun fact: over the last 19 years, only 2.32% of trading sessions have seen intraday dips of over 5%. That’s serious resilience!

Looking closer, the bank posted a year-on-year growth of 19.84%, far outpacing its five-year CAGR of 11.49%. Its annual revenue growth of 38.35% also blew past its three-year CAGR of 18.19%. Kotak is clearly on a roll—but there’s a catch. Over the past three years, its stock has underperformed, delivering -7.0% compared to the Nifty 100’s 43.63%. Could this contrast shake investor confidence?

Meanwhile, Cipla Ltd. had a rough day, sliding 3.37% to Rs. 1,623.90. Is this just a hiccup or something bigger? It’s worth noting that in the past 19 years, only 0.85% of Cipla’s trading days saw gains of over 5%. Still, its 15.43% ROE for 2024 outshines its five-year average of 11.98%, signaling potential strength. Plus, a 14-day moving average crossover yesterday hints at a possible rebound. Could Cipla be ready for a turnaround? Only time will tell.

Advance Decline Ratio

Today, the advance-decline ratio was 1.18, and the market breadth was positive. The volatility index India Vix decreased by 4.65 to settle at 13.47 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1484
Decliners – 1257
52Wk High – 75
52Wk Low – 15
High Band Hitters – 142
Low Band Hitters – 42
200d SMA – 23201
50d SMA – 25051
20d SMA – 25504

Top Gainers and Losers Stocks

The top gainers were Kotak Bank (+3.84%), JSW Steel (+1.85%), HDFC Bank (+1.71%), BEL (+1.59%), and IndusInd Bank (+1.51%).

The top losers were Cipla (-3.37%), Tech Mahindra (-2.82%), Trent (-2.26%), Sun Pharmaceutical (-1.86%), and Infosys (-1.80%).

Top Gainers and Losers Sectors

The top gainers sector were Financial Services (+0.93%), Metal (+0.40%), and Auto (+0.30%).

The top losers sector were Pharma (-2.01%), IT (-1.25%), Media (-0.46%), FMCG (-0.45%), and Realty (-0.40%).

SECTORS – NOTABLE ACTION
FINANCIAL SERVICES +0.93%
METAL +0.40%
AUTO +0.30%
PHARMA -2.01%
IT -1.25%
MEDIA -0.46%

Stocks Ban List

(SEBI) F&O ban list (TATACHEM close at +1151.20), (GNFC close at +648.50), (GRANULES close at +578.40), (SAIL close at -129.97), (PNB close at -103.69), (RBLBANK close at +200.70), (HINDCOPPER close at -312.15), (MANAPPURAM close at -188.68), (IDFCFIRSTB close at +73.14), (BANDHANBNK close at -187.70), and (BSOFT close at -584.65) 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.

CHAMBLFERT, IEX, NATIONALUM, NMDC, CANBK, AARTIIND, GMRINFRA, PEL, BALRAMCHIN, LICHSGFIN, and LTF stocks has the possibilities of entrance in the ban list.

BANDHANBNK, and BSOFT stock has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 24700 to 25200 is the Nifty 50 trading range.

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