Stock Market Highlights: Indian equity benchmark indices Sensex and Nifty recovered from day's low to end flat on Wednesday. Broader markets outperformed the benchmarks as the smallcap and midcap indices closed over half a percent higher. Among sectors, gains were seen in banks, metals and energy stocks, while selling was seen in IT, auto, pharmaceutical and media indices.
Ajit Mishra, VP - Research, Religare Broking
Markets traded volatile for yet another day and ended almost unchanged, in continuation to the recent consolidation phase. The benchmark hovered range-bound in the first half however sharp swings in index majors in the latter half kept the traders on their toes.
We expect choppiness to continue in the index on Thursday as well due to the scheduled weekly expiry. Nifty has been hovering within the 17,250-17,400 zone and either side break would trigger the next directional move. Apart from the global markets, traders should keep a close watch on the banking pack for cues.
Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The present short term consolidation movement is expected to end soon and that could open a decisive upside bounce from the lows in the next 1-2 sessions. The confirmation of higher bottom is likely to pull Nifty towards 17,550-17,600 levels by next week. Immediate support is placed at 17,250 levels.
Deepak Jasani, Head of Retail Research, HDFC Securities
Nifty made a lower low compared to the previous two sessions but closed flat to mildly higher. This means sell-offs are being bought into. Also, the advance decline ratio improved to much above 1:1 denoting some return of confidence by the participants. 17,254-17,437 could be the trading band for the Nifty over the next few sessions.
Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities
Benchmark Nifty witnessed selling pressure near 17,400 resistance level, but once again found support near 17,250 and recovered quickly to pare losses which is broadly positive for the market. On charts, the index has formed a double top formation, while at the same time it is consistently taking support near 17,250-17,280 levels. The texture of the chart suggests range bound activity may continue in the near future. For the day traders, 17,280 would be the key level to watch out for, and if the index rises above the same, the uptrend formation could continue up to 17,400-17,475 levels. On the flip side, dismissal of 17,280 could trigger one more leg of correction up to 17,250-17,200 levels.
Anindya Banerjee, DVP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities
The rupee saw a follow through on the way up just ahead of noon fix, as risk-off sentiments prevailed in equity markets on the back of news of a probable default by the second-largest property developer in China, Evergrande. Corporate outflows were noted on the back of dividend payments. However, dollar selling from exporters and FPIs capped the advance and pushed the pair from 73.70 to 73.60 at the close of the spot. Bias remains of a range between 73.00 and 74 on spot.
Rupee At Close | The Indian rupee fell for the third straight session to end 18 paise lower at 73.60 against the US dollar, tracking a strong American currency in the overseas market and muted trend in domestic equities. The local currency opened at 73.48 and dropped to a low of 73.70 in the day trade.
Rahul Sharma, Co-Founder, Equity99
The market is further expected to consolidate for some days. We expect some momentum in Mid & Small Caps. Expect the rally in Banking stocks to further continue.
On small duration charts, recovery has been seen from today’s low of 17,254 but at closing, we can see another small red candle for the third session of this week, the market is bound to remain in a consolidation range in the last session tomorrow, Nifty has strong support at 17,300 followed by 17,225-17,150 on the downside & hurdle is placed at 17,425-17500 levels on the upside. The uptrend is still intact as can see super trends on the bullish side only.
Bank Nifty had a very strong momentum & during the day we have seen good momentum in the entire space of banking and financials along with PSU in play, Now Nifty bank has major support at 36,600 followed by 36,450 – 36,300 on the downside & similarly hurdle on the upside is placed at 36,900-37100 levels.
Aashish Somaiyaa, Chief Executive Officer, White Oak Capital
A granular look at the data of equity and balanced/balanced advantage category of schemes suggests that the gross flow, the redemption and the net flow for the months of July and August remains to be at the same elevated level. But there is significant shrinkage in the net flow for the equity category and a corresponding bump up in net inflow of the balanced advantage category. This leads one to believe that on aggregate industry level large balanced advantage NFO has garnered a lot of traction by way of switches from equity to balanced advantage category. From a retail investors’ perspective in the short term, it may not be a bad development given elevated market levels and generally lower risk perception of balanced advantage funds.
Manish Shah, Founder, Niftytriggers.com
Nifty saw a sharp bounce from the lows as the Nifty attracted buyers towards fag end of the day's close. This is the second day when we are seeing this tendency of the market to revert from the lows of the day. This means that there is latent buying on declines. Three-day range bound movement means that Nifty is catching its breath after a strong rally. Usually this type of pattern resolve as continuation patterns.
Nifty is in a strong trend as MACD continues to be bullish and RSI shows a strong momentum as it remains elevated above 60 levels. ADX also displays a strong momentum.
Tomorrow is the weekly expiry and if Nifty manages to break past 17,450 expect a strong push towards 17,720-17,820 in the next couple of days. The momentum is decidedly up and rising. Avoid selling in anticipation of a downward move. This market is a buy on the decline. Any fall in Nifty up to 17,150-17,200 will be buying opportunity.
Binod Modi, Head Strategy at Reliance Securities
Domestic bourses witnessed modest contraction today mainly led by profit booking in IT and Auto stocks. Further, weak cues from global equities also weighed on investors’ sentiment.
The market appears to be a bit fatigued after a sharp rebound in recent weeks. However, we continue to believe that high-frequency key economic indicators for Aug’21 in the form of GST collection, railway freight, auto sales volume despite semiconductor issues, power consumption, import-export data and fuel volumes indicate a sustained economic recovery on YoY comparison.
While concerns over global growth due to the recent rise in delta variant Coronavirus cases in different parts of the world continues to persist, we believe that the underlying strength of the domestic market remains intact. In our view, festive demand, recovery in rural demand and COVID-19 positivity rates will be in focus in the near term. We note higher government’s capex and revival in industrials’ capex should aid economic recovery. However, a liquidity-driven market may take a backseat in 2022 and investors must start focusing on the quality aspect of companies, in our view.
S Hariharan, Head - Sales Trading, Emkay Global Financial Services
There are a number of developed market central bank meetings scheduled this week, which would provide greater insight into plans for tapering of asset purchases, which in turn would have implications for currency markets as well as risk assets. As a result, we have seen a trend of increase in long stock futures positioning by FIIs start to come down over the last 3 sessions. Since mid & small-cap indices are trading close to resistance levels despite the Nifty making new highs, overall market sentiment remains cautious, and the market advance is still dominated by a handful of stocks. Cement and PSU indices appear to have the highest relative strength while Autos are the weakest sector in the market overall.
Market At Close | Sensex & Nifty close with minor cuts; Reliance & IT top losers
Market At Close | Here are the highlights of today's trading session
-Sensex & Nifty Close With Minor Cuts; Reliance & IT Top Losers
-Broader Markets Outperform Benchmarks; Market Breadth Favours Advances
-Kotak & HDFC Bank Lift Nifty Bank With The Leading Index Rising Nearly 1%
-Nifty Closes 9 Points Lower At 17,354 & Sensex 29 Points Lower At 58,250
-Nifty Bank Gains 299 Points To 36,768 & Midcap Index 151 Points To 29,256
-Kotak, HDFC Bank & ICICI Bank Top 3 Contributors To Nifty On The Upside
-Autos Under Pressure As The PLI Scheme Is Likely To Be Only For EVs
-SBI Life Falls Nearly 2% Despite Strong Performance In the Month Of August
-Bharti, Voda Idea Erases Gains As Relief Measure Not Taken Up In Cabinet Meet
-Indus Towers, IDFC First Bk & IndusInd Fall On ‘No Telecom Relief Measures’ Too
-IRCTC Falls 4% From Day’s High To Close With A Minor Gain Of 0.3%
-Info Edge Surges Over 8% On The Positive Note By Brokerages
-Auto PLI For EVs Helps Greaves Cotton Surges In The Last Hour Of Trade
Closing Bell | Indian equity benchmark indices Sensex and Nifty recovered from day's low to end flat on Wednesday. The Sensex ended 29.22 points, or 0.05 percent, lower at 58,250.26, while the Nifty eased 8.60 points, or 0.05 percent, to close at 17,353.50. Broader markets outperformed the benchmarks as the smallcap and midcap indices closed over half a percent higher.
Among sectors, gains were seen in banks, metals and energy stocks, while selling was seen in IT, auto, pharmaceutical and media indices. Divi’s Laboratories, Nestle India, SBI Life Insurance, Wipro and Hindalco Industries were the top Nifty50 losers, while Kotak Mahindra Bank, PowerGrid Corporation, Grasim Industries, BPCL and Coal India were the top index gainers. Read here.
Arun Kumar Singh takes over as new chairman, VRK Gupta new Director (Finance) of BPCL
Arun Kumar Singh has taken over as the new chairman and managing director of Bharat Petroleum Corporation Ltd (BPCL), the privatisation-bound company said on Wednesday. Vetsa Ramakrishna Gupta is the new Director (Finance) of India's second-largest fuel marketing company.
World stocks fall from record high, dollar firm on economy worries
World stocks fell from the previous session's record highs and European stocks dropped on Wednesday on caution over the pace of economic recovery, while the dollar hit one-week highs as investors reduced exposure to riskier assets.
Accommodative central bank policies and optimism about reopening economies have pushed world stocks to record highs, but concerns are growing about the impact of rising coronavirus infections due to the Delta variant.
Ashis Biswas, Head of Technical Research at CapitalVia Global Research
The market witnessed a small correction and a reversal from the support of the Nifty50 Index level of 17,250. The market suggests that 17,200-17,250 will be an important support zone to stay positive in the short term. If the market is able to sustain the level of 17200-17250, it can witness higher levels of 17,500. The technical indicator suggests a volatile movement in the market in a small range between 17200-17500.
Tarun Birani, Founder & CEO, TBNG Capital Advisor
The latest AMFI data suggests investors are favoring equities. Outflow in small-cap is in line with valuations in this space going high and higher inflow in dynamic asset allocation is in right direction as investors are indecisive about allocating capital in pure equity strategy and valuation driven strategy in equity allocation is a better strategy. We are currently in bull phase of equity due to easy Liquidity and Flows and learnings from Previous Bull Markets is not to put entire money in equity and basis individual risk tolerance asset allocation should be done.
CNBC-TV18 EXCLUSIVE | Proposed outlay for auto PLI likely to be slashed to Rs 26,000 cr vs Rs 57,000 cr earlier
The production linked incentive (PLI) scheme for the automobile industry is set to disappoint large OEMs as the scheme will only be for electric vehicle and hydrogen fuel cell vehicles, sources said. The government is likely to slash the proposed outlay for auto PLI scheme to Rs 26,000 crore from Rs 57,000 crore earlier. The PLI scheme for the auto sector has been modified after feedback from PMO.
The government's view is that it is time to promote new technologies rather than those that already have scale. Considered view is that internal combustion engine vehicles already have huge volumes. The government is giving a direction to industry to shift to new technologies.
PLI scheme for component makers covers 20 items in both electric and internal combustion components. The scheme outlay has been reduced as electric vehicles and hydrogen fuel vehicles are emerging sectors, sources said. The scheme is likely to be taken to Cabinet around September 15.
Textile stocks surge as government approves PLI scheme for sector
Several textile stocks surged on Wednesday as that the Union Cabinet approved the Production Linked Incentive Scheme for textiles. Earlier in the day, sources had told CNBC-TV18 that incentives worth Rs 10,683 crore will be provided to the textile industry.
The government expects that the scheme will result in a fresh investment of above Rs 19,000 crore and additional production turnover of over Rs 3 lakh crore in 5 years, the sources had said. Read here
Mutual Fund Data | August SIP inflows come in at Rs 9,920 crore against Rs 9,609 crore in July.
Snowman Logistics bets on enhanced operational capacity; eyes Rs 280-300 crore revenue in FY22
Snowman Logistics has expanded a fair amount of its operational capacity to serve the e-commerce space. Throwing more light on the outlook for the rest of the year, Sunil Nair, CEO and wholetime director, spoke to CNBC-TV18.
Nair said, “Pharma is one segment of our business and vaccinations are a part of that business, which has contributed around 3-4 percent of the total pharma revenues. The company is the sole distribution partner to Dr Reddy’s Laboratories (DRL), which has launched the Sputnik V vaccine. Currently, for the pharma business, our run rate is 15 percent, while last year it was around 9-10 percent.” Watch here.
Recovery in volumes, non-Covid drugs pushes up India Pharma Market growth to 18%: Anand Rathi
Driven by a volume bounce-back and recovery in non-Covid’19 sales, the India Pharma Market grew 17.7% in Aug. The non-Covid-19 drug range, which makes up 63% of the market, is now growing in mid-teens, while the Covid-19 portfolio still continues to grow faster. In Aug, volumes aided 9% growth while price growth was 5.9%, and 2.9% from launches. Acute therapy sales grew at a strong 24.5%, while chronic and sub-chronic therapies grew 10.1% and 14.7% respectively. Ipca, Ajanta, Indoco and FDC were front-runners of growth in Aug.
The IPM is expected to grow in mid-teens ahead, in line with its past average. In the near term, recovery in volumes and higher acute-therapy sales would boost market growth. In the long run, though, factors such as greater availability of medicines and healthcare facilities would be crucial. Chronic therapies would outstrip acute therapies in the long run as emerging lifestyle diseases boost demand for chronic drugs. The sector continues to hike prices 5-6% while launches will contribute markedly to growth.
Gaurav Garg, Head of Research CapitalVia Global Research
In a major move towards making domestic more liquid, capital markets regulator SEBI, on Tuesday introduced T+1 settlement cycle for the completion of share transactions on an optional basis. However, traders may be concerned as Fitch Ratings said India continues to lag way behind in COVID vaccination. Our research suggests that if markets breach the level of 17,450, we could expect the market to gain momentum, leading to an upside projection till 17,500-17,700.
Ratnamani Metals & Tubes | The company has received a domestic order of Rs 148.95 crore for supply of Carbon Steel Line pipes from Oil & Gas sector, to be executed by May, 2022