Nifty Soars to New Heights Despite Hawkish BoE and ECB

At the close, the Nifty 50 was at 21,456.65 up by 1.29%

The NSE Nifty 50 index kicked off on a highly positive note, marking a significant 1.29% surge and concluding in the green zone, surpassing the remarkable 21,400 milestone. This consistent upward trajectory signifies an impressive seven-week streak of gains, driving the index to attain an unparalleled all-time high. Bulls maintain dominance in the market, dictating prevailing sentiment, notably reinforced by technical charts that portray an absence of reversal signals.

Factors Influencing Market Confidence and Direction Anticipation is rife concerning a resurgence in US economic growth slated for the latter half of 2024. Investor confidence remains buoyed by expectations of a seamless economic transition, supported by the normalization of monetary policy.

The USD/INR pair experienced a sharp decline, driven by prognostications hinting at potential interest rate cuts in the forthcoming year. Simultaneously, the IT sector has outperformed predictions, buoyed by projected heightened demand within the US economy.

Foreign Investor Interest and Market Dynamics The state election results have triggered heightened interest among foreign investors in domestic equities. This surge in investment is credited to perceived political stability and the anticipated continuity of reforms. While the dovish stance of the US Federal Reserve, coupled with declining bond yields and reduced crude oil prices, has notably enhanced market sentiment, overbought technical conditions could potentially prompt the benchmark to consolidate shortly, despite the current bullish outlook.

Sustained Optimism and Attraction for Foreign Investors The persistent optimistic sentiment stemming from the US Federal Reserve’s dovish outlook for 2024 remains unwavering. Foreign investors continue to be drawn to India’s robust fundamentals, supported by a weakening dollar and easing bond yields, further reinforcing the positive market sentiment.

Bank Nifty: Up by 0.86%

Today’s market session witnessed a positive start for the Bank Nifty, opening in the green and surging by 0.86%, eventually closing at 48,143.55 with continued momentum. Similarly, the BSE Sensex reflected strong growth, rising by 1.37% and concluding the day at a notable high of 71,483.75, reinforcing the positive sentiment in the markets.

The Bank Nifty’s upward movement showcases the resilience and strength of the banking sector, while the BSE Sensex’s substantial surge reflects widespread bullishness across various sectors.

In the sectorial front, the IT sector, showcasing a significant increase of 4.56%. This surge has been notably driven by key players like HCL Technologies Ltd., marking an impressive gain of 5.59%, closely followed by Tata Consultancy Services Ltd. with a noteworthy 5.56% increase in their stock value. Contrarily, the realty sector faced a setback, experiencing a decline of 0.71%. Prestige Estates Projects Ltd. recorded a notable decrease of -4.43%, while The Phoenix Mills Ltd. faced a more moderate downturn of -2.81%.

Foreign Institutional Investors (FIIs/FPIs) displayed a strong buying trend in the market, with a recorded buy value of Rs. 37,677.58 crore and a sale value of Rs. 28,438.16 crore, resulting in a net value of Rs. 9,239.42 crore. This considerable net value signifies their notable influence and bullish stance in the market.

Contrastingly, Domestic Institutional Investors (DIIs) exhibited a different trend, as they recorded a buy value of Rs. 11,300.61 crore against a higher sale value of Rs. 14,378.04 crore, resulting in a negative net value of Rs. -3,077.43 crore. This demonstrates a selling trend by DIIs, showcasing a divergence in their market approach compared to FIIs/FPIs.

Bank Nifty

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

The gainers included Bandhan Bank with a 3.97% increase, State Bank of India with a 3.95% increase, Federal Bank with a 2.69% increase, IDFC First Bank with a 1.99% increase, and Bank of Baroda with a 1.86% increase. On the other hand, the biggest losers in the sector included AU Bank with a 0.58% decline, Kotak Bank with a 0.26% decline, and Axis Bank with a 0.13% decline. These results suggest that banking stocks performed better for the day.

Indian Rupee Records Significant Gain Amid Dollar Inflows and Equity Market Surge

The Indian rupee exhibited remarkable strength on Friday, marking its most substantial single day surge in over eight months, primarily attributed to substantial dollar inflows and a robust rally in the domestic equity markets, which reached new record highs.

Closing at 83 against the US dollar, the rupee appreciated by 0.4%, showcasing its most impressive one-day performance since April 5. This upward momentum contributed to the local unit’s most significant weekly gain since August 25, rising by the same percentage over the course of the week.

The surge in the rupee was facilitated by substantial dollar sales from major foreign banks, particularly on behalf of custodian clients, further reinforcing the currency’s upward trajectory.

Amidst stability in most Asian currencies, the dollar index slightly climbed to 102 during Asian trading hours. While the Indian rupee has generally lagged behind its key Asian counterparts due to US dollar weakness, it notably emerged as the strongest performer on Friday, showcasing its resilience in the forex market.

This surge in the rupee’s value reflects investor confidence in India’s economic prospects, coupled with increased foreign investment inflows, underlining the nation’s robust financial standing amidst global currency fluctuations.

Stocks Highlights

HCL Technologies Ltd. Showcases Robust Growth, HDFC Life Sees a Downturn

HCL Technologies Ltd. demonstrated a substantial increase in its share price, marking a notable 5.59% rise from its previous close of Rs 1,414.60, reaching Rs 1,493.65. The company’s annual revenue growth of 18.56% surpassed its 3-year CAGR of 12.86%, reflecting impressive financial performance. Notably, historical intraday data reveals that only 2.09% of trading sessions in the last 19 years witnessed gains higher than 5%, signifying the rarity of such substantial increases.

Furthermore, HCL’s prudent financial management is evident as it allocated less than 1% of its operating revenues to interest expenses and allocated 54.49% toward employee costs for the fiscal year ending March 31, 2023.

On the contrary, HDFC Life Insurance Company Ltd. experienced a downturn with its share price declining by -1.83% from its previous close of Rs 684.55 to Rs 672.00. A bearish trend signal emerged with a 5-day moving crossover, historically resulting in an average price decline of -1.96% within 7 days, indicating a potential downward trajectory.

Similar to HCL, HDFC Life maintained a disciplined financial approach, utilizing less than 1% of its operating revenues for interest expenses and allocating 4.37% toward employee costs for the year ending March 31, 2023. Interestingly, intraday declines exceeding 5% occurred in only 0.67% of trading sessions in the last 6 years, emphasizing the infrequency of significant declines.

Advance Decline Ratio

Today, the advance-decline ratio was 1.10, and the market breadth was positive. The volatility index India Vix increased by 6.55 percent to settle at 13.13 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 1294
Decliners – 1173
52Wk High –  265
52Wk Low – 7
High Band Hitters – 81
Low Band Hitters – 45
200d SMA – 18963
50d SMA – 19845
20d SMA – 20441

Top Gainers and Losers Stocks

The top gainers were HCL Technologies (+5.59%), TCS (+5.56%), Infosys (+5.00%), SBIN (+3.95%), and Tata Steel (+3.45%).

The top losers were HDFC Life (-1.83%), Nestle India (-1.54%), Bharti Airtel (-1.09%), SBI Life (-1.04%), and Bajaj Auto (-0.93%).

Top Gainers and Losers Sector

The top gainers sector were IT (+4.56%), Metal (+2.13%), Oil & Gas (+1.23%), Financial Services (+0.32%), and Consumer Durables (+0.17%).

The top losers sector were Realty (-0.71%), FMCG (-0.32%), Media (-0.18%), and Auto (-0.04%).

SECTORS – NOTABLE ACTION
IT +4.56%
METAL +2.13%
OIL & GAS +1.23%
REALTY -0.71%
FMCG -0.32%
MEDIA -0.18%

Stocks Ban List

(SEBI) F&O ban list (SAIL open at +111.25 and close at +111.45), (BALRAMCHIN open at +389.15 and close at -384.65), (MANAPPURAM open at +173.15 and close at +172.45), (HINDCOPPER open at +186.00 and close at +187.40), (ZEEL open at -282.90 and close at -277.60), (INDIACEM open at +272.50 and close at -266.20), (DELTACORP open at +138.85 and close at +140.15), and .40), and (IBULHSGFIN open at +215.50 and close at +221.30) 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, RBLBANK, CHAMBLFERT, ASHOKLEY, BIOCON, GMRINFRA, TATACHEM, IEX, INDUSTOWER, ABCAPITAL, and GRANULES stocks has the possibilities of entrance in the ban list.

DELTACORP, and IBULHSGFIN has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 21250 to 21600 is the Nifty 50 trading range.

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