RSI Indicator Shows Bearish Crossover in Oversold Zone Market Sentiment Weakens

At the close, the Nifty 50 was at 21,418.65 down by 0.18%

The NSE Nifty 50 commenced on a downward trajectory, registering a 0.18% decline and wrapping the day slightly above the 21,400 mark after a volatile session. Mixed global cues prompted a negative opening for domestic indices, which struggled to maintain momentum despite an initial recovery. However, bearish sentiment prevailed later in the day, pulling the market into the red.

Analysis of the daily chart revealed a candlestick pattern hinting at a possible downward trend for the Nifty. This pattern could potentially disrupt the existing upward trajectory. Additionally, the Relative Strength Index (RSI) indicator on the hourly timeframe signaled a fading bullish sentiment with a bearish crossover in the oversold zone.

The market’s subdued start was attributed to concerns about potential oil supply disruptions in the Red Sea and unease surrounding high valuations, impacting investor confidence. Globally, attention remains on the BoJ monetary policy and UK inflation data, influencing market sentiment.

Forecasts suggest an imminent consolidation phase, driven by recent rapid market performance. Worries about El Nino’s impact and a slowdown in global GDP contribute to expectations of temporary market consolidation. Investors may adopt a cautious stance given prevailing market dynamics and global economic conditions.

Bank Nifty: Down by 0.57%

The Bank Nifty commenced on a negative note, experiencing a decline of 0.57%. This downward trend persisted throughout the day, resulting in a closing figure of 47,867.70, signaling a subdued performance within the banking sector. Similarly, the BSE Sensex also saw a marginal downturn, dropping by 0.24% and culminating at a low point of 71,315.09 by the day’s close.

The red figures for both indices indicate a cautious market sentiment, reflective of prevailing uncertainties or factors influencing investor sentiment. While the declines were modest, they underscore the subtle fluctuations occurring within the stock market, impacting key indices like Bank Nifty and BSE Sensex.

In the sectorial front, the media sector, marking a substantial gain of 1.18%. Hathway Cable & Datacom Ltd. witnessed an impressive ascent of 5.65%, while Nazara Technologies Ltd. followed suit with a commendable 2.58% increase, positioning them prominently within the sector’s growth trajectory. Conversely, the realty sector faced a downturn, emerging as the top loser with a decline of 0.96%. Swan Energy Ltd. experienced a notable setback, marking a loss of -3.72%, while Godrej Properties Ltd. observed a decrease of -2.98%, both contributing to the sector’s overall decline.

The Foreign Institutional Investors (FIIs/FPIs) witnessed a marginal downturn in their activities, with a recorded buy value of 11,473.54 and a sale value of 11,507.05, resulting in a net value of -33.51 (Rs. Cr.). On the other hand, Domestic Institutional Investors (DIIs) exhibited robust engagement, reflecting a buy value of 9,657.75 and a sale value of 9,243.87, culminating in a noteworthy net value of 413.88 (Rs. Cr.).

Bank Nifty

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

There are no gainers today. On the other hand, the biggest losers in the sector included AU Bank with a 1.42% decline, ICICI Bank with a 1.20% decline, IndusInd Bank with a 1.07% decline, Axis Bank with a 0.83% decline, and Federal Bank with a 0.38% decline. These results suggest that banking stocks not performed better for the day.

Rupee Settles Marginally Lower Against Dollar Amid Market Trends

On Monday, the Indian rupee initially exhibited strength against the US dollar, opening at 82.97 and traversing within a range of 82.90-83.06 in the interbank foreign exchange market. However, it relinquished its early gains to conclude at 83.05, down by 2 paise from its previous closure, paralleling a subdued performance in the domestic equity markets.

The currency’s dip was contrasted by a weaker greenback compared to significant global currencies, coupled with consistent investment inflows from foreign investors, offering underlying support to the rupee’s stability.

Friday saw the rupee closing at 83.03 against the dollar, experiencing minor fluctuations despite a rapid rally from 83.30 to 82.90, mainly attributed to profit booking alongside a mild decline in the capital markets.

Despite this temporary setback, the rupee’s short-term trajectory appears positive. Factors such as the dollar index exhibiting widespread weakness and a steady influx of funds into Indian capital markets indicate a favorable outlook. Forecasts predict a trading range for the rupee between 82.75 and 83.25 in the near term.

In parallel market news, Brent crude futures, the global oil benchmark, displayed a 0.57% decline, settling at $76.121 per barrel, signifying a slight downturn in the oil market amidst these currency fluctuations.

Stocks Highlights

Bajaj Auto Ltd.: The recent trading session witnessed a notable surge in Bajaj Auto Ltd.’s share price, rising by 2.87% from its previous close of Rs 6,275.20 to reach Rs 6,455.05. The company’s new dividend policy, pegged to cash reserves, signals a positive outlook for investors. With the current reserve levels, anticipated dividend payouts for FY23 and beyond indicate a potential significant increase. Remarkably, the company has remained debt-free for the past five years, portraying a financially robust standing. Moreover, its prudent management of expenses is evident, with less than 1% allocation towards interest expenses and 4.07% towards employee costs for the fiscal year ending on March 31, 2023.

Power Grid Corporation of India Ltd.: In contrast, Power Grid Corporation of India Ltd. experienced a decline in its share price by -2.11%, dropping from Rs 237.35 to Rs 232.35. However, the company’s financial indicators present a different picture. While its operating revenues allocated 5.5% towards employee costs, a noteworthy 21.14% was directed towards interest expenses for the year ending March 31, 2023. This signifies a relatively higher financial commitment to interest payments compared to Bajaj Auto Ltd., potentially influencing its financial performance.

Advance Decline Ratio

Today, the advance-decline ratio was 1.11, and the market breadth was positive. The volatility index India Vix increased by 5.88 percent to settle at 13.90 and the FIIs were net sellers today.

DAILY MARKET ACTION
Advancers – 1321
Decliners – 1186
52Wk High –  228
52Wk Low – 7
High Band Hitters – 120
Low Band Hitters – 72
200d SMA – 18982
50d SMA – 19885
20d SMA – 20526

Top Gainers and Losers Stocks

The top gainers were Bajaj Auto (+2.87%), Hindalco (+1.57%), Sun Pharmaceutical (+1.46%), Adani Ports (+1.06%), and Reliance (+0.98%).

The top losers were Power Grid (-2.11%), ITC (-1.36%), Tech Mahindra (-1.23%), ICICI Bank (-1.20%), and JSW Steel (-1.17%).

Top Gainers and Losers Sector

The top gainers sector were Media (+1.18%), Pharma (+0.94%), Consumer Durables (+0.51%), Metal (+0.43%), and Auto (+0.17%).

The top losers sector were Realty (-0.96%), Financial Services (-0.39%), FMCG (-0.31%), and IT (-0.27%).

SECTORS – NOTABLE ACTION
MEDIA +1.18%
PHARMA +0.94%
CONSUMER DURABLES +0.51%
REALTY -0.96%
FINANCIAL SERVICES -0.39%
FMCG -0.31%

Stocks Ban List

(SEBI) F&O ban list (BALRAMCHIN open at +410.00 and close at +400.50), (SAIL open at +112.00 and close at +115.45), (MANAPPURAM open at +176.00 and close at -171.30), (HINDCOPPER open at +187.50 and close at +197.05), (INDIACEM open at -266.20 and close at -260.00), (ZEEL open at -270.85 and close at +280.50), and (DELTACORP open at +140.25 and close at +142.05) 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.

NATIONALUM, ASHOKLEY, RBLBANK, PEL, TATACHEM, GNFC, INDUSTOWER, ABCAPITAL, CHAMBLFERT, IEX, BIOCON, GRANULES, and GMRINFRA stocks has the possibilities of entrance in the ban list.

DELTACORP has the possibilities of exit from the ban list.

Daily Pivots

As per the above pivots data, 21300 to 21500 is the Nifty 50 trading range.

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