Profit-Taking Anticipated Index Breaks Support Level with Bearish Engulfing Pattern

At the close, the Nifty 50 was at 20,906.40 down by 0.43%

The NSE Nifty 50 commenced positively, scaling new heights at 21,037.90, only to witness a downturn, closing with a 0.43 percent decline, causing concern among investors. This reversal from record highs has stirred caution, attributing the shift to global economic cues, including US inflation data anticipation and upcoming central bank meetings.

The day commenced with optimism, mirroring global market trends. However, midday brought consolidation and subsequent profit booking, leading to a lower closure. Notably, the index exhibited negative divergence, breaching robust support levels and forming a bearish engulfing pattern at peak levels, signaling a probable short-term apex and hinting at an imminent minor correction.

Amidst this, the global economic stage, especially the anticipation surrounding the US economic data and central bank meetings, played a pivotal role in the market’s movements. The potential insights into future interest rate adjustments added to the market sentiment.

Today’s consolidation coincided with the expected rise in November inflation in India, particularly due to surging food prices, possibly delaying RBI policy cuts. This stands in contrast to the steady US inflation outlook, which might sway upcoming US Fed policy decisions.

The market’s current volatility, prompted by diverse economic indicators globally, underscores the necessity for investor vigilance and strategic assessment. It’s essential to anticipate short-term corrections amid evolving economic landscapes and disparate inflationary trends.

Bank Nifty: Down by 0.46%

The Indian stock market exhibited a day of varied performance, notably witnessed in the trajectory of both Bank Nifty and BSE Sensex. Bank Nifty began positively but concluded with a 0.46 percent decline, closing at 47,097.55, dipping into negative territory. Correspondingly, the BSE Sensex mirrored this trend, dropping by 0.54 percent and settling at a low of 69,551.03, marking a close in the red zone.

In sectorial analysis, the Media sector showcased upward momentum, registering a 0.59 percent gain. Notable surges were seen in TV18 Broadcast Ltd., surging impressively by 4.86 percent, and Dish Tv India Ltd., rising by 4.24 percent, contributing significantly to this sector’s growth. Conversely, Realty emerged as the top loser, witnessing a decline of 1.75 percent. Prestige Estates Projects Ltd. experienced a substantial downturn of -7.26 percent, alongside Sobha Ltd. with a decrease of -4.70 percent, leading to the sector’s overall downturn.

Foreign Institutional Investors (FIIs/FPIs) showed marginal dominance in the market with a Net Value of Rs. 76.86 Cr., recording a Buy Value of Rs. 16,037.09 Cr. against a Sale Value of Rs. 15,960.23 Cr. Contrarily, Domestic Institutional Investors (DIIs) demonstrated stronger participation, registering a substantial Net Value of Rs. 1,923.32 Cr. with a Buy Value of Rs. 12,206.24 Cr. and a Sale Value of Rs. 10,282.92 Cr.

Bank Nifty

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

The gainers included Axis Bank with a 1.30% increase, AU Bank with a 0.36% increase, Bank of Baroda with a 0.19% increase. On the other hand, the biggest losers in the sector included IndusInd Bank with a 1.50% decline, Kotak Bank with a 1.25% decline, Federal Bank with a 1.20% decline, HDFC Bank with a 1.00% decline, and IDFC First Bank with a 0.40% decline. These results suggest that some banking stocks not performed better for the day.

Rupee Holds Steady Amidst Market Caution and External Cues

The Indian rupee witnessed a marginal decline, settling at 83.38 (pro) against the US dollar, maintaining a narrow range as market players exercised caution preceding the release of domestic inflation figures and the imminent US Federal Reserve meeting.

The domestic equity markets experienced selling pressure, dampening overall market sentiment. Despite this, the rupee’s decline was curbed by the weakness of the American currency against major global currencies, serving as a mitigating factor.

Commencing at 83.36 against the greenback, the local unit concluded at 83.38 (pro), incurring a nominal loss of 1 paisa from its previous closure of 83.37 on Monday, reflecting a stable yet cautious trend.

Investor apprehension persisted over forthcoming domestic inflation and industrial production data scheduled for later announcement, indicating a watchful stance amid evolving market dynamics.

Simultaneously, anticipation surrounded the US Federal Reserve’s upcoming monetary policy decision, contributing to the cautious market environment. The dollar index, measuring the greenback against a basket of currencies, exhibited a 0.28 percent decline at 103.41 on Tuesday.

Moreover, Brent crude futures, the global oil benchmark, demonstrated a modest increase of 0.34 percent, reaching $76.29 per barrel, signifying potential implications on market sentiments given the fluctuating oil prices.

The rupee’s stability within a narrow range amidst varied global and domestic cues underscores the significance of market vigilance and adaptability for investors navigating the currency market.

Stocks Highlights

HDFC Life Insurance Company Ltd.: Upward Movement Amidst Cautionary Signals

HDFC Life Insurance Company Ltd. observed a notable increase in its share price, rising by 5.14 percent from its preceding close of Rs 672.50 to Rs 707.10. Despite this surge, a sell signal was indicated, favoring the bears due to a recent Daily MACD crossover. Historical data highlights an average price decline of -3.31 percent within 10 days post this signal over the past decade. Intriguingly, only 1.27 percent of trading sessions in the last 6 years exhibited intraday gains exceeding 5 percent. The company’s allocation towards interest expenses stood at less than 1 percent of its operating revenues, with employee costs accounting for 4.37 percent in the fiscal year ending Mar 31, 2023.

Apollo Hospitals Enterprise Ltd.: Decline Amidst Bearish Signals

Conversely, Apollo Hospitals Enterprise Ltd. witnessed a decline of -2.10 percent in its share price, falling from Rs 5,547.35 to Rs 5,430.90. This decline coincided with a sell signal triggered by a Weekly stochastic crossover on the week ending Dec 08, 2023. Historical data reveals an average price decline of -6.45 percent within 7 weeks post this signal over the past decade. Interestingly, only 1.51 percent of trading sessions in the last 19 years depicted intraday declines surpassing 5 percent. The company allocated 2.29 percent of its operating revenues towards interest expenses and 12.9 percent towards employee costs in the fiscal year ending Mar 31, 2023.

Advance Decline Ratio

Today, the advance-decline ratio was 0.59, and the market breadth was negative. The volatility index India Vix decreased by 0.35 percent to settle at 12.71 and the FIIs were net buyers today.

DAILY MARKET ACTION
Advancers – 911
Decliners – 1549
52Wk High –  191
52Wk Low – 7
High Band Hitters – 128
Low Band Hitters – 30
200d SMA – 18913
50d SMA – 19747
20d SMA – 20207

Top Gainers and Losers Stocks

The top gainers were HDFC Life (+5.14%), UltraTech Cement (+2.11%), Bajaj Auto (+1.72%), SBI Life (+1.67%), and Axis Bank (+1.30%).

The top losers were Apollo Hospitals (-2.10%), Sun Pharmaceutical (-1.96%), Maruti (-1.82%), Coal India (-1.65%), and Eicher Motors (-1.63%).

Top Gainers and Losers Sector

The top gainers sector were Media (+0.59%), Metal (+0.31%).

The top losers sector were Realty (-1.75%), Oil & Gas (-1.30%), Consumer Durables (-1.04%), Auto (-0.70%), and Pharma (-0.48%).

SECTORS – NOTABLE ACTION
MEDIA +0.59%
METAL +0.31%
REALTY -1.75%
OIL & GAS -1.30%
CONSUMER DURABLES -1.04%

Stocks Ban List

(SEBI) F&O ban list (BALRAMCHIN open at +399.10 and close at -389.70), (HINDCOPPER open at -183.90 and close at -179.85), (INDIACEM open at -269.00 and close at -266.70), (SAIL open at +101.20 and close at -100.00), (IBULHSGFIN open at -200.75 and close at +200.50), (NATIONALUM open at +98.45 and close at -96.95), and (DELTACORP open at -137.20 and close at +137.65) 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.

MANAPPURAM, GMRINFRA, RBLBANK, ASHOKLEY, ABCAPITAL, and CANFINHOME stocks has the possibilities of entrance in the ban list.

Daily Pivots

As per the above pivots data, 20800 to 21050 is the Nifty 50 trading range.

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