Record High Market Plunge Due to Volatility, Banks Suffer Major Impact

At the close, the Nifty 50 was at 21,741.90 up by 0.05%

The NSE Nifty 50 began the new year on a fluctuating note, opening with slight losses but managing to ascend by 0.05% and concluding in the green zone. Despite initial bearish trends, last-hour buying propelled the index to touch an all-time high of 21,834.35. However, profit booking activities at these elevated levels negated the gains, resulting in a marginal closing above the crucial support level of 21,700.

Optimism surrounding potential rate cuts, global inflation easing, and softer bond yields fueled market strength. Yet, concerns persisted due to disruptions in the Red Sea, posing short-term risks to global supply chains and freight expenses. This backdrop heightened investor caution, particularly with the focus on the forthcoming FOMC minutes, anticipated to shed light on potential 2024 rate adjustments.

Amidst this backdrop, mid and small-cap segments maintained robust momentum, underpinned by a positive macro-outlook. Conversely, private banks experienced a reversal in their upward trajectory, marking a trend shift.

The day’s trading session underscored the market’s sensitivity to both domestic and global factors. While record highs were breached, profit booking underscored investor wariness, indicative of a cautious approach amidst lingering uncertainties. The upcoming FOMC minutes and the evolving global landscape are poised to influence market sentiment, guiding investor actions in the coming sessions.

Bank Nifty: Down by 0.12%

The trading day commenced with the Bank Nifty displaying a downward trend as it opened in the red, marking a decrease of 0.12%. This trajectory persisted throughout the day, ultimately closing at 48,234.30, reflecting a continued decline. Conversely, the BSE Sensex opened with a marginal rise, increasing by 0.04%. This positive momentum was sustained, culminating in a green closing at a notable high of 72,271.94.

In the realm of sectorial performance, the Media sector experienced a notable upturn, marking an increase of 1.78%. This surge was particularly evident in companies like Dish TV India Ltd., which saw a commendable rise of 4.92%, and TV18 Broadcast Ltd., boasting an increase of 3.27%. On the flip side, the Financial Services sector faced a slight setback, with a marginal decline of 0.14%. This downturn affected companies such as Cholamandalam Investment & Finance Company Ltd., experiencing a decrease of -2.60%, and Muthoot Finance Ltd., noting a decrease of -0.97%.

Foreign Institutional Investors/Foreign Portfolio Investors (FII/FPI) exhibited a net selling trend, with sales outweighing purchases. The sales value stood notably higher at Rs. 2,167.09 crore compared to the buy value of Rs. 1,311.29 crore, resulting in a negative net value of Rs. -855.80 crore.

Contrastingly, the Domestic Institutional Investors (DII) showcased a net buying trend, indicating stronger purchases than sales. DIIs recorded a higher buy value of Rs. 7,004.39 crore against a sale value of Rs. 6,593.93 crore, yielding a positive net value of Rs. 410.46 crore.

Bank Nifty

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

The gainers included Punjab National Bank with a 1.67% increase, Bandhan Bank with a 0.91% increase, Bank of Baroda with a 0.82% increase, and Federal Bank with a 0.22% increase. On the other hand, the biggest losers in the sector included IDFC First Bank with a 1.29% decline, HDFC Bank with a 0.96% decline, Axis Bank with a 0.66% decline, State Bank of India with a 0.62% decline, and Kotak Bank with a 0.58% decline. These results suggest that some of the banking stocks not performed better for the day.

Rupee Opens 2024 with Mixed Trading

The rupee commenced the new year in a mixed trajectory, displaying sideways movement within the range of 83.23-83.31. Initially, a positive opening led to a slight gain of 0.03rs, but profit booking ensued, retracting towards 83.31 during the day. Throughout the trading session, the rupee hovered within the range of 83.15-83.45. Factors such as dollar index weakness, global market volatility, and the RBI’s efforts to maintain rupee stability contributed to this range-bound movement.

However, the day saw the rupee starting on a weaker note, depreciating by 6 paise to 83.22 against the US dollar. This depreciation was attributed to subdued domestic equities and heightened dollar demand from importers, exerting downward pressure on the currency.

Global cues were notably absent, contributing to the rupee’s narrow trading range. Additionally, the closure of global crude oil markets due to the New Year Day holiday further limited market influences.

At the interbank foreign exchange market, the rupee initiated trading at 83.18 and concluded at 83.22 against the dollar, witnessing a decline of 6 paise from its previous close. This followed a minor appreciation of 4 paise on the preceding trading day, settling at 83.16 against the US dollar in 2023’s final trading session.

Meanwhile, the dollar index, gauging the greenback’s strength against a basket of six currencies, exhibited a marginal increase of 0.05%, standing at 101.38, adding to the dynamics influencing the rupee’s performance in the global currency markets.

Stocks Highlights

Nestle India Ltd. witnessed a positive movement in its share price, marking an increase of 2.95% from its previous close of Rs 26,580.30 to a last traded price of Rs 27,364.00. A notable bullish signal emerged with a weekly stochastic crossover observed in the week ending Dec 29, 2023. Historical data reveals an average price gain of 4.7% within 7 weeks following this signal over the last decade. Additionally, the company announced a stock split from a face value of 10.0 to a face value of 1.0, effective from October 19, 2023, with a record date set for January 5, 2024.

On the other hand, Eicher Motors Ltd. experienced a decline in its share price, dropping by -2.62% from its previous close of Rs 4,143.50 to a last traded price of Rs 4,035.00. Similar to Nestle India, Eicher Motors also received a bullish signal through a weekly stochastic crossover during the week ending Dec 29, 2023. Historical data indicates an average price gain of 7.04% within 7 weeks following this signal over the past 10 years. Furthermore, Eicher Motors demonstrated impressive annual revenue growth of 40.03%, surpassing its 3-year compound annual growth rate (CAGR) of 15.58%. Notably, the company has managed its expenses efficiently, allocating less than 1% towards interest expenses and 6.94% towards employee costs in the fiscal year ending March 31, 2023.

Advance Decline Ratio

Today, the advance-decline ratio was 1.93, and the market breadth was positive. The volatility index India Vix increased by 1.22 percent to settle at 14.68 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1648
Decliners – 854
52Wk High –  237
52Wk Low – 6
High Band Hitters – 175
Low Band Hitters – 52
200d SMA – 19162
50d SMA – 20210
20d SMA – 21240

Top Gainers and Losers Stocks

The top gainers were Nestle India (+2.95%), Adani Enterprises (+1.89%), Adani Ports (+1.64%), Coal India (+1.60%), and Tech Mahindra (+1.58%).

The top losers were Eicher Motors (-2.62%), Bharti Airtel (-1.96%), M&M (-1.58%), Bajaj Auto (-1.46%), and Hindalco (-1.20%).

Top Gainers and Losers Sector

The top gainers sector were Media (+1.78%), Oil & Gas (+0.81%), FMCG (+0.54%), IT (+0.51%), and Realty (+0.45%).

The top losers sector were Financial Services (-0.14%), Auto (-0.13%), and Consumer Durables (-0.05%).

SECTORS – NOTABLE ACTION
MEDIA +1.78%
OIL & GAS +0.81%
FMCG +0.54%
FINANCIAL SERVICES -0.14%
AUTO -0.13%
CONSUMER DURABLES -0.05%

Stocks Ban List

(SEBI) F&O ban list (HINDCOPPER open at +275.80 and close at -271.50) 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.

SAIL, IEX, and BALRAMCHIN stocks has the possibilities of entrance in the ban list.

Daily Pivots

As per the above pivots data, 21600 to 21900 is the Nifty 50 trading range.

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