Nifty’s 1% Lower Finish amidst a Widespread Selloff

At the close, the Nifty 50 was at 22,519.40 down by 1.03%

The NSE Nifty 50 commenced the day on a negative note, recording a decline of 1.03% and closing below 22,550. The Indian benchmark indices mirrored subdued global cues, with investor sentiment impacted by multiple factors including the commencement of the Q4 earnings season, uncertainty surrounding US Fed rate cut timing, and escalating tensions between Iran and Israel.

April 12 witnessed a sharp one percent decline in benchmark indices, fueled by a broad-based selloff. Market sentiment took a hit following the release of US CPI inflation data, which dashed hopes of a June rate cut, consequently leading to a surge in treasury bond yields. The repercussions of this data are yet to unfold, with market participants eagerly awaiting the impact of TCS results on April 15.

Additionally, the Mauritius government’s decision to amend its double taxation avoidance agreement (DTAA) with India further dampened market sentiment. Despite challenges, there is optimism regarding potential positive trends post-elections, with midcaps and smallcaps expected to lead market momentum.

Internationally, US inflation surpassed expectations, raising doubts about the feasibility of anticipated rate cuts by the US Fed and impacting emerging markets’ performance. Conversely, European markets thrived as the ECB hinted at a potential rate cut amidst maintaining policy rates.

Indian markets continue to navigate uncertainties surrounding delayed US rate cuts, escalating geopolitical tensions, and subdued Q4 earnings outlooks, with cautious optimism prevailing amidst consolidation.

Bank Nifty: Down by 0.86%

The BankNifty index faced substantial selling pressure, signaling a resurgence of bearish momentum following an extended period of stability. Opening in the red, the BankNifty recorded a decline of 0.86% and closed at 48,564.55, indicative of investor apprehension and profit booking within the banking sector. Likewise, the BSE Sensex witnessed a downtrend, slipping by 1.06% and concluding at a low of 74,244.90.

Today, the sectorial landscape reflects widespread losses, with no sectors witnessing gains. Notably, the Pharma sector emerges as the top loser, experiencing a decline of 1.72%. Within this sector, Sun Pharmaceutical Industries Ltd. stands out with a substantial loss of -3.68%, followed by Laurus Labs Ltd. with a decline of -3.41%, and Zydus Lifesciences Ltd. with a decrease of -2.94%.

Foreign Institutional Investors (FII/FPI) exhibited a net selling trend, with a buy value of Rs. 15,405.32 crore and a higher sale value of Rs. 23,432.32 crore, resulting in a net value deficit of Rs. -8,027.00 crore.

In contrast, Domestic Institutional Investors (DII) displayed a net buying pattern, with a buy value of Rs. 17,220.28 crore and a lower sale value of Rs. 10,878.75 crore, yielding a net value surplus of Rs. 6,341.53 crore.

Bank Nifty

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

The gainers included AU Bank with a 0.54% increase, Bandhan Bank with a 0.22% increase. On the other hand, the biggest losers in the sector included Federal Bank with a 1.73% decline, State Bank of India with a 1.60% decline, Axis Bank with a 1.36% decline, HDFC Bank with a 1.31% decline, and Punjab National Bank with a 1.17% decline. These results suggest that most of the banking stocks not performed better for the day.

Rupee Weakens Against US Dollar Amidst Stock Sell-Off and Strong Greenback

In a tumultuous week for financial markets, the Indian rupee faced downward pressure, depreciating by 13 paise to close at 83.44 against the US dollar on Friday. The decline was primarily driven by a significant sell-off in domestic equities, coupled with the strength of the greenback against major currencies worldwide.

Adding to the currency’s woes were elevated crude oil prices, which further dampened investor sentiment. With the interbank foreign exchange market witnessing a volatile session, the rupee opened at 83.36 and hit an intraday low of 83.44 before settling at the same level by the day’s end.

Wednesday had seen the rupee holding steady at 83.31 against the US dollar, while Thursday saw forex markets closed due to Eid-Ul-Fitr celebrations. Meanwhile, the US dollar strengthened, reaching a five-month high as inflation figures surpassed expectations, diminishing prospects of a Federal Reserve rate cut in June.

The surge in crude oil prices, with Brent crude futures climbing to $90.61 per barrel, is poised to exert further downward pressure on the rupee, threatening the country’s current account dynamics. As market volatility persists, investors are closely monitoring geopolitical developments and central bank policies for potential impact on currency movements.

Stocks Highlights

Divi’s Laboratories Ltd. The share price of Divi’s Laboratories experienced a modest increase of 0.85%, closing at Rs 3,770.70. The company has maintained a prudent financial approach, allocating less than 1% of its operating revenues to interest expenses and 12.55% towards employee costs in the fiscal year ending March 31, 2023. However, recent market signals suggest a bearish trend may be imminent, with a 5-day moving crossover appearing on April 10, 2024. Historical data indicates an average price decline of -2.26% within 7 days following such signals over the past 5 years. Furthermore, the stock has delivered a 3-year return of -1.07%, significantly underperforming both the Nifty 100 index and the Nifty Pharma index.

In contrast, Sun Pharmaceutical Industries witnessed a decline of -3.68% in its share price, closing at Rs 1,545.00. Similar to Divi’s Laboratories, the company also maintains a conservative approach to financial management, with minimal expenditure on interest and a moderate allocation of 18.9% towards employee costs. However, the company has demonstrated robust stock performance, delivering a remarkable 3-year return of 158.99%, outperforming both the Nifty 100 and Nifty Pharma indices. Notably, there has been a significant increase in cash from investing activities, with the company utilizing Rs 7943.68 crore for investments, marking a year-on-year increase of 38.76%.

Advance Decline Ratio

Today, the advance-decline ratio was 0.50, and the market breadth was negative. The volatility index India Vix increased by 3.82 percent to settle at 11.53 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 867
Decliners – 1717
52Wk High –  124
52Wk Low – 6
High Band Hitters – 78
Low Band Hitters – 80
200d SMA – 20570
50d SMA – 22143
20d SMA – 22270

Top Gainers and Losers Stocks

The top gainers were Divi’s Laboratories (+0.85%), Bajaj Auto (+0.76%), Tata Motors (+0.64%), TCS (+0.48%), and Nestle India (+0.21%).

The top losers were Sun Pharmaceutical (-3.68%), Maruti (-3.26%), Power Grid (-2.51%), Titan (-2.38%), and ONGC (-2.35%).

Top Gainers and Losers Sector

The top losers sector were Pharma (-1.72%), Oil & Gas (-1.23%), Media (-1.21%), FMCG (-1.09%), and Financial Services (-0.90%).

SECTORS – NOTABLE ACTION
PHARMA -1.72%
OIL & GAS -1.23%
MEDIA -1.21%

Stocks Ban List

(SEBI) F&O ban list (NATIONALUM open at -181.25and close at -178.20), (BALRAMCHIN open at -388.00 and close at -377.80), (HINDCOPPER open at -357.35 and close at +362.40), (EXIDEIND open at -383.55 and close at +398.15), (ZEEL open at +150.30 and close at -146.55), (IDEA open at -12.65 and close at -12.95), (INDIACEM open at +227.00 and close at -224.60), and (SAIL open at +153.15 and close at +155.35) 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, GNFC, VEDL, ABFRL, and CANBK stocks has the possibilities of entrance in the ban list.

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

Daily Pivots

As per the above pivots data, 22400 to 22700 is the Nifty 50 trading range.

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Nifty 50 Continues Positive Trend, Hits New Highs

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