The equity market uptrend was primarily bolstered by declining oil prices, positive domestic PMI data, and the Monetary Policy Committee’s decision to maintain the status quo in the repo rate. However, the RBI continues to consider inflation a significant risk, and its tone was hawkish on Friday when it announced open market operations (OMO) to manage liquidity, which resulted in a substantial increase in the yield on 10-year bonds. Gains were constrained by the substantial FII outflow caused by elevated US bond yields and the US dollar index.

During the week, the BSE Sensex increased by 167 points to 65,996, the Nifty50 rose by 15 points to 19,654, and the Nifty Midcap 100 index declined by 0.6 percent, whereas the Smallcap 100 index increased by 0.7 percent. Pressure was felt on the automotive, banking, energy, pharmaceutical, and oil & gas sectors, while technology and real estate equities trended higher.

“A stronger dollar index and rising US bond yields have deterred foreign investors, resulting in market weakness.” “Additionally, strong employment figures from the United States this week have sparked apprehension regarding a possible interest rate hike by the Federal Reserve, as evidenced by the surge in US bond yields that suggests an imminent interest rate hike,” said Vinod Nair, director of research at Geojit Financial Services.

Additionally, he stated that the market has been affected by the RBI’s hawkish posture, especially in its management of liquidity to combat inflationary risks. Nevertheless, the market has received some solace from robust domestic PMI data and corrections in crude oil prices.

He believes that starting next week, the focus will shift to quarterly results from the IT and finance industries.

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Here are 10 key factors to watch out for:

Corporate Quarterly Earnings

CPI Inflation

The CPI inflation rate for September, which is released on October 12, will also be closely monitored by market participants in addition to earnings. As a result of the decline in LPG and vegetable prices, the CPI inflation rate, which is a crucial metric for the MPC, is anticipated to further decline.

“Since August, when it was 6.8 percent year-over-year, we estimate that CPI inflation decelerated significantly in September to 5.3 percent, returning to the RBI’s target range of 2-6 percent after a two-month absence.” According to Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics at Barclays, the headline rate probably declined due to a reduction in food and petroleum prices. Bajoria further stated that core inflation probably remained stable, enabling the RBI to maintain policy rates unaltered.

Furthermore, reports on foreign exchange reserves for the week ending October 6 and industrial output data for August are scheduled to be disseminated on October 13 and October 12, respectively. These reports pertain to the months of September and balance of trade and WPI inflation.

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FOMC Minutes & US Inflation

Global investors will closely monitor the FOMC minutes for the September policy meeting, which will be released on October 11th, and US inflation, which is scheduled for October 12th, as well as the upcoming speeches of several Fed officials.

Inflation, an essential data point for the Federal Reserve to consider when determining the fed funds rate, is expected to moderate in September from August’s 3.7 percent to August’s 3.6 percent, but to remain well above the Fed’s 2 percent target. Fed officials estimate inflation to reach 2.6% by the end of 2024 while ruling out a severe recession, as indicated by the Fed’s decision to leave interest rates unchanged at its September meeting. August’s core inflation rate was 4.3%, down from 4.7% the previous month.

China will also disclose its September inflation data. In August, the inflation rate was 0.1%.

Global Economic Data Points

Here are key global economic data points to watch out for:

FII Flow

Foreign institutional investors sold a net Rs 8,400 crore worth of shares in the cash segment during the previous week as the US 10-year Treasury yield rose to a 16-year high and the US dollar index reached its highest level since November of last year. Domestic institutional investors were able to offset the FII outflow, but the outflow may persist until US bond yields and the dollar index cool down, according to experts.

In the first week of October, DIIs net bought shares worth Rs 4,400 crore, while the US 10-year Treasury yield concluded the week at 4.8% and the US dollar index at 106.10.

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Oil Prices

As India is a net oil importer, the sharp decline in oil prices from a 10-month peak was positive for the Indian equity markets. Oil prices were affected during the week by rising US bond yields, a strengthened dollar, and global demand concerns. International benchmark Brent crude futures corrected by 8.26 percent during the week, the largest weekly loss since March, to settle at $84.58 a barrel, continuing downtrend for third consecutive week from the high of $95.96 a barrel.

After a precipitous decline in price, Saumil Gandhi, senior analyst – commodities at HDFC Securities, expects the crude oil price to consolidate in a lower-end range with a negative bias.

Technical View

The Nifty50 exhibited a strong recovery after defending the 19,300 level and ended a two-week losing trend. On the weekly charts, the index has formed a bullish candlestick pattern with a small body, a long lower shadow, and a small upper shadow, resembling a Hammer candlestick pattern, which is a bullish reversal pattern. This raised prospects for northward journey in coming sessions, which if comes true in following trade then 19,800-20,000 can’t be ruled out with crucial support at 19,600-19,300 area, experts said.

In the recent past, Nifty failed to surpass the short-term moving average (20 exponential moving average established at 19,670) and is currently hovering in the same region. A decisive close above 19,670 could help the index extend its rebound to the 19,800-20,000 range, according to Ajit Mishra, vice president of technical research at Religare Broking.

On the downside, he believes the region between 19,200 and 19,450 would continue to provide support in the event of a reversal.

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F&O Cues, India VIX

The Options data also indicated that the Nifty may encounter significant resistance between 19,900 and 20,000, with crucial support between 19,600 and 19,500.

According to weekly options data, the highest Call open interest (OI) was at the 20,000 strike, followed by the 20,500 and 19,900 strikes, with the most significant Call writing at the 20,500 strike, followed by the 20,000 and 19,900 strikes.

On the Put side, the highest open interest was recorded at the 19,500 strike, followed by the 19,600 and 19,000 strikes, with writing occurring at the 19,600 strike, followed by the 19,000 and 19,500 strikes.

During the previous week, volatility moderated substantially, providing solace to the bulls. The India VIX, which measures the expected volatility of the Nifty50 over the next thirty days, decreased by 10% from 11.45 to 10.3, the lowest level since July.

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IPO

The primary market appears to be experiencing a deceleration in activity, as only one initial public offering (IPO) is scheduled to commence subscriptions the following week. In the SME segment, Arvind and Company Shipping Agency of Gujarat will open its Rs 14.74-crore public offering from October 12-16 at an offer price of Rs 45 per share, whereas Committed Cargo Care will conclude its IPO on October 10.

In the mainboard segment, Plaza Wires, a wires manufacturing company based in Delhi, is scheduled to commence trading on the bourses on October 13. Arabian Petroleum, a manufacturer of lubricants, and E Factor Experiences, an event management firm, are both expected to list their shares on the NSE Emerge on October 9, in accordance with the IPO schedule.

On October 10, among others, City Crops Agro and Goyal Salt & Kontor Space will make their debuts on the BSE SME. On October 11, Oneclick Logistics India and Canarys Automations are scheduled to list their shares on the NSE Emerge.

Additionally, on October 12, Vivaa Tradecom is scheduled to commence trading on the BSE SME. On the same day, Vishnusurya Projects and Infra, Sharp Chucks and Machines, and Plada Infotech Services will all make their debuts on the NSE Emerge. Moreover, as of October 13, Karnika Industries will be listed on the NSE Emerge.

According to the IPO schedule, Sunita Tools shares are expected to be listed on the BSE SME on October 9; however, no circular from the exchange has been issued as of yet.

Also read :- RBI Policy | Higher for longer remains relevant not only for the world but also for India, says Indranil Pan

Corporate Action

Here are key corporate actions taking place next week:

Disclaimer: The opinions and investment recommendations put forth by investment specialists on Moneypoise.com are purely their own and do not reflect the stance of the website’s administration or its staff. Users are encouraged to consult certified experts prior to making investment decisions, as stated on Moneypoise.com.

The post Dalal Street Week Ahead | India, US inflation, quarterly earnings among 10 key factors to watch next week appeared first on Republic Aeon.

The Nifty50 rose 1.97 percent or 384.7 points this week to settle at 19,820, while the BSE Sensex rose 1.85 percent or 1,211.75 points to conclude at 66,598.91.

The broader indexes continued to excel this week, with the BSE Mid-cap index climbing 4%, the BSE Small-cap index growing 2.2 percent, and the BSE Large-cap index rising 2%.

“The domestic indices gradually rallied throughout the week, buoyed by strong macroeconomic data such as robust GDP and PMI figures, which painted a positive picture for the market.” Despite a mixed global trend characterized by poor indications, Indian shares have remained resilient, bolstered by this strong economic outlook,” said Vinod Nair, Head of Research at Geojit Financial Services.

Crude oil price increases, US unemployment claims statistics for August, disappointing Chinese service PMI and trade figures, and rising gas costs due to strikes in Australia stirred global alarm. However, despite their relatively high valuations, mid- and small-cap stocks drew substantial purchasing activity in the overall market. Furthermore, increased order inflows made sectors such as infrastructure and real estate particularly appealing to investors during the week.

“The market is now eagerly awaiting inflation and industrial production data to provide further guidance,” he said.

All sectoral indices finished in the green, with the BSE Realty index and BSE Capital Goods index each up 5%, the BSE Energy index up 4.7 percent, and the BSE Power index up 4.7 percent.

The BSE Small-cap index increased by 2.2 percent. MMTC, GTL Infrastructure, National Peroxide, Cochin Shipyard, Bombay Burmah Trading Corporation, Magadh Sugar & Energy, GMR Power, SpiceJet, Vikas WSP, Ashapura Minechem, Transformers and Rectifiers India, and Sadhana Nitrochem all increased their stakes by 21 to 50 percent.

“Both the Nifty and the Sensex gained around 2% and outperformed the majority of global equity markets.” Mid-cap and small-cap indices surpass the large-cap index. Macro emotions remained unpredictable as European and US bank flaws were highlighted. “Indian equity markets remain concerned about a slowdown in growth, higher interest rates, and valuation, even as inflation (particularly food inflation) remains elevated both globally and domestically,” said Shrikant Chouhan, Head of equities Research (Retail), Kotak Securities.

“The majority of indices finished in the green. During the week, FPIs/FIIs were net sellers while DIIs were net buyers. GST collections for July (collected in August) were 10.8 percent higher year on year at Rs 1.59 trillion (June: Rs 1.65 trillion).”

US Treasury yields dipped on Friday as investors worried about the likelihood of additional interest rate hikes in the wake of new economic data. Initial weekly jobless claims were 216,000 on Thursday, less than the 230,000 forecast. The Eurozone’s economy expanded by 0.1 percent in April-June compared to the previous three months, a lower rate than previously projected, and by 0.5 percent year on year after expanding by more than 1% last year. In Asia, China’s exports decreased 8.8 percent year on year in August, while imports declined 7.3 percent,” he noted.

This week, foreign institutional investors (FIIs) sold shares worth Rs 9,321.41 crore, while domestic institutional investors (DIIs) acquired shares worth Rs 4,572.14 crore.

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Where is Nifty50 headed?

Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas:

On the hourly chart, Nifty has reached the upper boundary of the ascending channel; consequently, a consolidation is likely to occur in the coming week. The likely range of consolidation is between 19850 and 19670. The daily and hourly momentum indicators have a positive crossover, which is a buy signal. Therefore, this is likely only a consolidation, and any dip should be viewed as a purchasing opportunity.

On the upside, we anticipate 19900, which is close to the swing high reached in July. In terms of price levels, 19630 – 19670 will serve as a crucial support zone, whereas 19860 – 19900 will serve as an immediate resistance zone.

Amol Athawale, Vice President – Technical Research, Kotak Securities:

After a promising reversal formation, the Nifty has maintained a higher bottom formation and is trading comfortably above the 50-day and 20-day SMA, which is largely bullish. In addition, it has formed a long bullish candle on weekly charts, which supports a continuation of the present uptrend.

For trend-following traders, the key support levels would be 19700 to 19650, and above those levels, the price could rise to 19900. Further gains could push the market to 20,000. In contrast, below 19650, the uptrend would be susceptible to a correction until the 50-day simple moving average or 19550-19500 levels.

Also read :–India and US resolve final WTO dispute, strengthen bilateral trade relations

Disclaimer: The opinions and investment advice expressed by experts on moneypoise.com are their own and do not reflect the views of the site or its management. moneypoise.com advises users to verify with certified experts before taking any investment decisions.

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Disappointing industrial production for June, a larger-than-anticipated increase in CPI inflation, fears of a likely additional rate hike by the Fed in light of strong retail sales data, currency depreciation versus the US dollar, rising US bond yields exerting pressure on FII flow, and a slowing Chinese economy all weighed on market sentiment.

According to experts, consolidation may persist with a negative bias in the coming week, with the focus on Powell’s speech, MPC policy minutes, FII sentiment, and global equity market activity.

The Nifty50 fell 118 points to 19,310 and the BSE Sensex fell 374 points to 64,949 as metal, banking & financial services, technology, oil & gas, and pharmaceutical equities weighed on the markets.

We expect domestic and global markets to remain under pressure next week due to Fed Chair Powell’s speech and the release of additional macroeconomic data, according to Siddhartha Khemka, chief of retail research at Motilal Oswal Financial Services.

However, he anticipates that the action will persist in the broader market alongside sector rotation.

Here are 10 key factors to watch out next week:

Jio Financial Services Listing

On August 21, the entity demerged from billionaire Mukesh Ambani-led Reliance, Jio Financial Services (formerly known as Reliance Strategic Investments), will be listed on the exchanges, drawing investor attention to the index heavyweight Reliance Industries (RIL).

Reliance’s financial services division is now worth Rs 261.85 per share following the spin-off last month.

On August 23, Jio Financial Services will join the MSCI Global Standard Index after already being included in the FTSE Indices.

MPC Meeting Minutes

In addition, on August 24, all attendees can find the minutes from the MPC’s August 10 meeting. After the Reserve Bank of India raised its Consumer Price Index inflation forecast for FY24 (to 5.4% from 5.1% earlier) due to the spike in food prices, experts believe the rate cut cycle will be pushed into FY25 instead of the fourth quarter of FY24. The Consumer Price Index increased by 7.44 percent in July, which was above market forecasts of a 4.87 percent increase.

Jackson Hole Symposium

The entire world will be listening to Federal Reserve Chair Jerome Powell’s remarks at the Jackson Hole economic policy conference on August 24-26. On August 25th, Powell will give a speech at an event organised by the Kansas City Fed. As the Fed remains firmly committed to bringing inflation back down to its 2% goal and continues to take a data-dependent approach in determining the extent to which additional policy firming may be appropriate going forward, Powell has already hinted at one more rate hike in upcoming policy meetings. Inflation in July was 3.2% according to the CPI and 4.7% according to the core CPI.

As a result, all eyes will be on his comments for any clear signals about when the current cycle of rate hikes might come to a stop and a new period of rate cuts might begin.

Here are key global economic data points to watch out next week:

FIIs Mood

The major reason for the FII outflow from emerging markets like India in August, after significant buying in the previous three months, is the rise in the US dollar index to 103.43 (from below the 100 mark in mid-July) and in US 10-year treasury yields to 4.25 percent (from 3.8 percent in mid-July). Despite the best efforts of DIIs to counteract the FII outflow, experts predict that the selling by FIIs will continue in the near future.

While foreign institutional investors (FIIs) net sold shares worth Rs 3,379 crore last week, bringing their monthly outflow to nearly Rs 11,000 crore in the cash segment, domestic institutional investors (DIIs) were able to more than make up for the FII outflow by buying shares worth Rs 3,892 crore last week, bringing their net buying for the month to around Rs 9,250 crore.

Indian Rupee

The Indian rupee’s performance will also be closely monitored by traders, as it recently set a record low of 83.42 versus the US dollar and a record closing low of 83.12 last week (on weekly basis) due to rising oil prices and the US dollar index. The rupee has been weak for four weeks running due to factors including profit taking in the stock market and FII outflow, and this trend is expected to continue in the days ahead.

We anticipate the Rupee will trade with a negative bias due to widespread fear in international markets and the Dollar’s general strength. Research analyst at Sharekhan by BNP Paribas, Anuj Choudhary, warned that a rise in crude oil prices could have a negative impact on the rupee.

On the other hand, he thinks that the rupee might be supported at lower levels by the Reserve Bank of India.

Domestic Economic Data Points

On the domestic data front, the foreign exchange reserves for the week ended August 18 will be announced on the same day as the bank loan and deposit growth figures for the week ended August 11.

Technical View

The Nifty50 made lower highs for the fourth week in a row and closed at its lowest level since the last week of June on a weekly basis, but it held above its 50-day EMA (exponential moving average), which corresponds with its 10-week EMA (exponential moving average) on an intraday basis, and above its closing level of 19,300. Therefore, the 19,300-19,250 zone is anticipated to be important for further fall into the psychological 19,000 mark, while the 19,400-19,500 zone is predicted to act as a barrier to the upside.

“Nifty has respected the short term moving average i.e. 50-day EMA twice of late, which currently lies around 19,250 and its break could push the index to 19,100 first, and then to the 18,900 level,” Ajit Mishra, SVP – technical research at Religare Bros., said.

In the event of a reversal, he sees resistance between the 20-day EMA and the 19,650 mark.

F&O Cues

According to the Option data, the range of 19,400-19,500 represents major resistance in the upcoming trading sessions, while the range of 19,300-19,200 represents key support.

Weekly Call open interest peaked at the 19,400 level, followed by the 19,500 level, with significant writing at the 19,400, 19,300, and 19,600 levels, while Put open interest and writing peaked at the 19,300 and 19,200 levels, respectively.

The India VIX rose 5.4% throughout the week, finishing at 12.14 levels, the highest level since the third week of May. This is the third consecutive week that volatility has increased. Additional street caution may be warranted if the VIX rises above the 13.5–14 range , experts said.

IPO

Aeroflex Industries, a manufacturer of flexible flow solution products, will open its Rs 351-crore IPO from April 22-24 at a price band of Rs 102-108 per share, and the infrastructure company Vishnu Prakash R Punglia will launch its Rs 309-crore maiden public issue on August 24 at a price band of Rs 94-99 per share, so the primary market will remain active next week as well.

According to the IPO schedule, on August 22 Pyramid Technoplast will complete its Rs 153-crore IPO, and on August 23 TVS Supply Chain Solutions will make its debut on the bourses.

Also Read : Mcap of seven of top 10 firms declines by Rs 80,200 cr; TCS, HDFC Bank biggest laggards

Sungarner Energies, a provider of power solutions, will begin accepting subscriptions for its initial public offering (IPO) on April 21–23 at an offer price of Rs 83 per share; Shoora Designs will end its IPO on August 21; Crop Life Science and Bondada Engineering will both end their IPOs on August 22; and so on. Next week, on August 23, Shelter Pharma shares will be listed on the stock market.

Corporate Action

Here are key corporate actions taking place next week:

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This week, the BSE Sensex decreased 0.57 percent, or 373.99 points, to finish at 64,948.66, while the Nifty50 decreased 0.60 percent, or 118.1 points, to end at 19,310.20.

The BSE Small-cap index ended on a flat note, while the BSE Large-cap index declined 0.7% and the BSE Mid-cap index fell 0.5%.

“Sensex and Nifty fell this week due to weakness in the majority of global equity markets.” The BSE Mid-cap and BSE Small-cap indices experienced a reversal. The majority of sectoral indices posted negative returns. BSE Metals, BSE Energy, and BSE Oil & Gas are among the sectoral indices that underperformed the broader markets, according to Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities.

“Weak monsoon conditions prevailed across the majority of India in August, culminating in a deficient monsoon. In July 2023, India’s consumer price index (CPI) inflation increased to 7.4% (from 4.8% in June 2023), as a result of rising vegetable prices. This week, the price of Brent crude oil experienced a correction, but it remains above the price range observed a few months ago. Consumption demand weakened in the first quarter of fiscal year 24; however, investment demand remained robust. Additionally, Q1FY24 results demonstrated a further increase in profitability,” he added.On the sectorial front, the BSE Metal index fell 4%, the BSE Telecom index fell 2%, the BSE Oil & Gas index fell 1.2%, and the BSE Power index rose 0.5%.

The BSE Small-cap index concluded on a note of parity. Hindustan Oil Exploration Company, Rico Auto, Sree Rayalaseema Hi Strength, Lloyds Steels Industries, Universal Cables, GE Power India, Pix Transmissions, and Globus Spirits all experienced losses ranging from 12% to 32%.

Also Read : Moody’s affirms India’s Baa3 rating, but warns of political tensions

The post More than 50 smallcaps give double digit return despite market fall appeared first on Republic Aeon.

The BSE Sensex dropped 106 points to end the session at 65,846 points, and the Nifty50 fell 26 points to end the session at 19,570 points as it traded around its 200-day moving average of 19,591 points while attempting to maintain its recent upward trend.

Support for the Nifty appears at 19,541, followed by 19,517 and 19,478 on the pivot point calculator. Upwards, major resistance may be found at 19,618, followed by 19,642 and 19,681.

Listen in on Moneypoise to hear the latest on the day’s currency and stock market movements. We have compiled a collection of major stories from various media outlets that could have an effect on the markets in India and elsewhere.

GIFT Nifty

After Nifty ended August 8 down 26 points at 19,570, the GIFT Nifty showed a flat to slightly positive start for the broader market with a gain of 24 points. The futures price of the GIFT Nifty was 19,577.

US Markets

US stock futures were relatively unchanged Tuesday night, even after a selloff in the main averages. Futures for the Dow Jones Industrial Average dropped 27 points, or 0.08 percent. The futures for the S&P 500 and the Nasdaq 100 both fell by 0.06 percent.

Penn Entertainment gained 12% in after-hours trading after the casino announced it would establish an online sportsbook with ESPN this autumn. The service will be branded ESPN Bet. Tuesday’s trading day was a loss for the major indices, and investors are reeling. The Dow Jones Industrial Average ended the day down 158.64 points (or 0.45%). That’s still an improvement over the Dow’s session lows, when it was down around 465 points.

The S&P 500 was down 0.42 percent, and the Nasdaq Composite was down 0.79 percent at the same time. Tuesday’s selloff follows Tuesday’s Moody’s downgrading of numerous regional banks, which lowered investor morale. Despite the remarkable advance in equities this year, several market participants were worried that the signal could herald more turmoil for markets in the future.

European Markets

On Tuesday, European markets fell as investors responded to Italy’s unexpected banking tax proposal and prepared for important inflation data anticipated later this week.

The pan-European Stoxx 600 index closed down 0.2%, with banking registering the largest percentage loss (-2.7%) among the broader sector declines (-0.2%). Contrary to the market, healthcare shares rose by 3.2%. The banking sector in Italy was struck hard by the government’s unexpected announcement of a windfall tax of 40% on banking earnings. A successful drug trial result from Danish pharmaceutical company Novo Nordisk sparked the optimistic session in health care.

As investors took profits near the end of earnings season and risk sentiment came to focus, the European blue-chip index ended Monday’s session up 0.1 percent, seemingly entering suspended animation following last week’s global drop.

On Wednesday, China is expected to disclose its consumer price index, and on Thursday, the United States will do the same. Analysts predict that China’s CPI will show disinflation of 0.5 percent year over year, which will reduce global price pressures but may indicate that additional fiscal stimulus is needed from Beijing. The FTSE ended the day down 0.36 percent at 7,527 points, while the DAX finished down 1.10 percent at 15,774 points.

Asian Markets

The consumer price index is expected to enter deflationary territory for the first time since February 2021, and investors in the Asia-Pacific region were cautious ahead of China’s inflation numbers for July.

Reuters’ survey of economists forecasts a 0.4% annual drop in China’s inflation rate. There will also be a drop of 4.1% in the country’s producer price index, which gauges the change in selling prices received by domestic producers for their output. The Hang Seng index futures were trading at 19,084, indicating a higher opening for the HSI than its previous closing value of 19,184.17.

The Nikkei 225 index in Japan dropped 0.24 percent and the Topix index dropped 0.3 percent in early morning trading. South Korea, on the other hand, saw gains of 0.88 percent on the Kospi and 1 percent on the Kosdaq. The S&P/ASX 200 in Australia was trading near its flat line.

Moody’s reduced the credit rating of several regional banks, citing deposit risk, a probable recession, and faltering commercial real estate portfolios, which caused a selloff across all three main US indexes overnight. There was a decrease of 0.45% for the Dow Jones Industrial Average, a drop of 0.425% for the S&P 500, and a decrease of 0.799% for the Nasdaq Composite.

At Rs 1.85 lakh crore, mutual funds see highest quarterly inflows in 4 years in April-June

The first three months of the fiscal year 2024 got off to a good start, with open-ended mutual funds receiving net inflows of Rs 1,84,789 crore—the highest in four years, with the vast majority of these funds being invested in fixed income.

According to the most recent report from Morningstar India, net inflows into open-ended funds began the June quarter on a good note, totaling Rs 1,23,613 crore in April before falling to Rs 59,879 crore in May and a disappointing Rs 1,295 crore in June. Meanwhile, the industry’s AUM reached Rs 44.13 lakh crore by the end of June, an increase of 13% over the previous quarter.

Coal India Q1 results: Net profit declines 10% to Rs 7,941 crore, beats estimate

Coal India Limited (CIL), a state-owned company, announced a consolidated net profit of Rs 7,941.4 crore for the quarter ended June on August 8, down 10% from the same period last year.

However, Q1FY24 net profit was more than expected. The consensus expectation among analysts at the three major brokerage houses was for a net profit of Rs 6,125 crore. The largest coal miner in the world reported earnings of Rs 35,943.21 crore, an increase of 2.5% from the previous quarter’s earnings of Rs 35,092.17 crore.

Revenue for the company rose from Rs 36,086.68 crore in Q1FY23 to Rs 37,521.03 crore in Q1FY24, an increase of 3.9%. CIL’s overall expenses for the first quarter grew by 11.5% year-over-year, from Rs 23,985.31 crore to Rs 26,745.68 crore.

EIH Q1 Results: PAT up 61% YoY at Rs 106 cr, consolidated revenue stands at Rs 522 cr

The Oberoi Group’s main company, the hospitality chain EIH Limited, reported a 26.7 percent YoY increase in consolidated revenue to Rs 522.6 crore for the June quarter of the financial year 2024. In the first quarter of FY24, the hotel chain reported a profit after tax (PAT) of Rs 106 crore, an increase of 61% year over year.

“We are ecstatic with the exceptional financial success in Q1 FY24. Vikram Oberoi, CEO and MD, EIH, claimed that the rapid increase in sales and profits was a direct result of the hard work of his company’s employees and the continued confidence of the hotel’s regular visitors. In terms of EBITDA (profit before interest, taxes, depreciation, and amortisation), the company reported Rs 180 crore, a year-over-year increase of 53.1%.

Oil Prices

On Tuesday, oil prices dipped after fresh data revealed a steeper-than-anticipated drop in crude imports and exports from the world’s largest oil importer in July.

In the futures market, a barrel of Brent crude was selling for $84.93, down 48 cents, or 0.41 percent. The price of a barrel of West Texas Intermediate crude in the United States fell by 50 cents, or 0.62%, to $81.43. Earlier in the session, the price of both contracts dropped by $2. China’s daily oil imports in July were the lowest they’ve been since January, albeit they were still up 17% from the same time a year ago.

In July, China’s imports fell 12.4%, which was far more than the predicted reduction of 5%. In contrast to the predicted drop of 12.5%, exports decreased by 14.5%. Fuel usage in India dropped to a 10-month low in July, official statistics indicated on Tuesday, as monsoon rains limited people’s ability to get around. When it comes to oil consumption and imports, India ranks third. Some analysts were optimistic about China’s fuel demand for the period of August to early October despite the dismal numbers.

Also Read : Pyramid Technoplast IPO opens on Aug 18, price band set at Rs 151-166

Dollar Index

Futures contracts for the Dollar index rose 0.52 percent to 102.57, while the value of one dollar stayed close to Rs 82.88.

Gold Prices

On Tuesday, gold touched a four-week low as the dollar rose in response to weaker-than-expected Chinese trade data, and as investors remained wary ahead of this week’s U.S. inflation figures. Gold hit its lowest point since July 11 at $1,925.69 per ounce, down 0.55 percent. US gold futures dropped 0.5% to $1,960.10.

“A risk-averse mood has set in as a result of China’s dismal trade figures. “The dollar has been people’s safe haven of choice today, and that’s been putting pressure on gold,” said Russell Shor, a market specialist at FXCM.

FIIs and DIIs

On August 8, provisional data from the National Stock Exchange (NSE) showed that foreign institutional investors (FII) sold shares worth Rs 711.34 crore, while domestic institutional investors (DII) acquired shares worth Rs 537.31 crore.

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The BSE Sensex gained 481 points, closing at 65,721, while the Nifty50 rose 135 points, closing at 19,517, and forming a bullish candlestick pattern.

“Last week’s low was at 19,296 levels, so a break there would signal a decline to 18,838. Nifty currently stands at a pivotal point in its development. According to Ashish Kyal, CMT, Founder & CEO of Waves Strategy Advisors, any directional move would likely take place after next week’s rangebound move between 19,290 & 19,800 levels.

A break of this range, in his opinion, would signal a significant shift in the market. He suggested using a mild Options approach for range bound or consolidation movement during these periods.

The Nifty Midcap 100 and the Nifty Smallcap 100 both rose by 0.8 percent on the back of this optimistic market breadth, indicating strong purchasing activity across the board.

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This week, both the BSE Sensex (down 0.66 percent, or 438.95 points), and the Nifty50 (down 0.65 percent, or 129.05 points), finished at lower numbers than their previous weekly closing levels.

The BSE SmallCap Index increased by 1.5%, the BSE MidCap Index ended unchanged, and the BSE LargeCap Index decreased by 0.6%.

“The week started off on a hopeful note, with expectations that the policy-tightening era can come to an end as a result of falling inflation rates around the world. However, Vinod Nair, Head of Research at Geojit Financial Services, noted that “worries across the globe were triggered by negative news regarding the US rating downgrade, weak factory activity data from the Eurozone and China, and prolonged FII selling triggered by rising US bond yields.”

“As fears about the state of the US economy grew, investors fled to the dollar in search of safety, sending the dollar index soaring. Nonetheless, domestic markets rebounded from the effect of weak global cues, with IT and healthcare sectors leading the way in terms of strong domestic results.

While manufacturing in India remained strong in July, it slowed for the second consecutive month. Conversely, thanks to an increase in new orders, especially from outside, the domestic service PMI surpassed market expectations and hit a 13-year high. Nair remarked, “Investors are waiting for the next MPC meeting to see if the RBI will maintain its policy rate at 6.5 percent.”

The Nifty Realty index plummeted 4.2%, the Nifty PSU Bank index fell 4.0%, the Nifty FMCG index lost 1.7%, the Nifty IT index jumped 3.0%, and the Nifty Pharma index rose roughly 2%.

Lloyds Steels Industries, Digispice Technologies, MPS, Optiemus Infracom, Sanghi Industries, Jai Balaji Industries, HCL Infosystems, Udaipur Cement Works, WPIL, and Dilip Buildcon all contributed to a 1.5 percent increase in the BSE SmallCap index.

Bajaj Hindusthan Sugar, Equitas Small Finance Bank, Tracxn Technologies, Sintex Plastics Technology, MSP Steel & Power, Ador Welding, Thangamayil Jewellery, Redington, Shivalik Bimetal Controls, Bhagiradha Chemicals and Industries, and Sintex Plastics Technology all saw their share prices drop by 10-15%.

Nifty found some relief at the end of a turbulent week by climbing back above the 19,500 level. The IT sector sparked the recovery, but the BFSI sector, which was hit the worst, carried it ahead and restored optimism in the market. Keep in mind that we haven’t made it through this ordeal unscathed. For the first time since March 31, 2023, we are technically positioned below the 20-day EMA (exponential moving average) for the Nifty. Therefore, unless the Nifty closes over 19,550-1,600, complacency is not warranted. Angel One’s Head of Research, Technical and Derivatives, Sameet Chavan, advised, “It’s best to avoid aggressive trades.”

If there are further unusual events on a global scale, the Nifty could test the 19,400-19,300 zone again. If prices drop below this level, they could face more selling pressure and head towards the next key area between 19,000 and 18,800.

For the positive scenario to come to fruition, it is essential to get over 19,600, and all international trends must cease entirely. The market’s mixed signals for the week’s close suggest taking things slowly for the time being. Chavan also expressed hope that the present downturn would not be prolonged for too much longer, and that the fabled 20,000 mark would be reached soon.

While domestic institutional investors (DIIs) bought shares worth Rs 5,617.33 crore this week, foreign institutional investors (FIIs) sold shares worth Rs 3,545.64 crore.

Where is Nifty50 headed?

According to Rupak De, Senior Technical Analyst at LKP Securities, the Nifty dropped significantly after the US credit rating was lowered from AAA to AA+, resulting in a breakdown from the recent consolidation on the daily timeframe. The index has fallen below the 21-day EMA for the first time since March 29 due to the recent decline. 19 300 individuals served as immediate support. On the upside, however, 19,566 is likely to function as a significant resistance level.

As long as the Nifty stays below 19,566, sentiment is likely to remain negative. In contrast, a decisive rise above 19,566 could propel the index to 19,700–19,750. A failure to advance above 19,566 could trigger selling pressure, however.

According to Jatin Gedia, a Technical Research Analyst at Sharekhan by BNP Paribas, the Nifty was able to recoup some of its losses in the final trading session of the week, following severe selling throughout the week. On a weekly basis, however, it has closed in the red for the second week in a row. The pullback is likely to stall in the 19,560–19,600 range, where the 40-hour moving average and the hourly upper Bollinger band provide resistance. Therefore, this rebound should be marketed to.

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The hourly momentum indicator has also reached the equilibrium line, indicating that the retreat is complete and can commence a new downward cycle. Overall, the trajectory remains negative, and we anticipate levels of 19,100 in the near future, he added.

The Bank Nifty has also experienced a decline. It is unlikely, however, to result in a larger trend reversal. The pullback is likely to end in the 45,100–45,200 range, where the 40-hour moving average and the hourly upper Bollinger band provide resistance. The hourly momentum indicator has recorded a retracement to the equilibrium line, indicating that the retracement has reached completion and can now initiate a new cycle. Overall, the trajectory is still negative, and we anticipate a short-term decline to 44,000.

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Both the Sensex (which rose 480.57 points, or 0.74%, to 65,721.25) and the Nifty (which rose 135.30 points, or 0.70%, to 19,517) increased as of market close.

The market opened higher and kept rising throughout the day, eventually closing around its high. This occurred despite mixed global indications.

The BSE Sensex and Nifty50 both fell by 0.6% throughout the course of the week.

Top Nifty gainers included Cipla, IndusInd Bank, Tech Mahindra, Wipro, and Bharti Airtel, while top losers included SBI, Bajaj Auto, BPCL, NTPC, and Maruti Suzuki.

Two industries saw gains of 1%: pharmaceuticals and information technology, while financial services, industrial metals, and capital goods all gained 0.5%. Automakers and utility companies were among the biggest sellers.

The BSE mid and small cap indices both saw gains of 0.6%.

LIC Housing Finance, Info Edge, and Jubilant FoodWorks all had significant increases in their buildups, while Aditya Birla Fashion & Retail, Mahanagar Gas, and Cummins India all had negligible increases.

Among individual stocks, a volume spike of more than 300 percent was seen in Indiabulls Housing Finance, Cummins India and Info Edge.

More than 200 stocks touched their 52-week high on the BSE, including Tribhovandas Bhimji Zaveri, SML Isuzu, NBCC, Info Edge, Lupin, Karnataka Bank, JK Tyre, Gravita India, Dixon Technologies and Apollo Tyres.

Outlook for August 7

Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas:

The Nifty started the day up and continued rising, eventually finishing the day up by about 130 points. The Nifty recovered some of its weeklong losses on Friday after experiencing heavy selling activity earlier in the week. However, on a weekly basis, it has already closed in the red for the second week running. The decline is quite likely to stall in the 19560 – 19600 range, where the 40-hour moving average and the hourly upper Bollinger band are located as resistance. Therefore, this rebound represents a buying opportunity. Even the hourly momentum indicator has hit its neutral line, suggesting the correction has completed its maturation and is ready to start a new cycle to the negative. In general, the trend is still down, and in the near future, we anticipate seeing values around 19100.

The Bank Nifty has also had a correction, although this should not be seen as the beginning of a wider trend reversal. The downturn is quite likely to end where the 40-hour moving average and the hourly upper Bollinger band meet, at around 45100 to 45200. The retreat has reached maturity and can begin a new cycle, as seen by the hourly momentum indicator’s crossing of the equilibrium line. We still see a general downward trend, and a drop to around 44,000 seems likely in the near future.

Ajit Mishra, SVP – Technical Research, Religare Broking:

The market recovered from its recent decline and climbed by more than half a percent. Following the gap to the upside at the opening bell, Nifty traded in a narrow range all day until closing at 19,518. Meanwhile, the sectoral front showed a mixed trend, with IT, pharma, and banking all posting decent gains and keeping the traders active. The broader indices also rose, by roughly the same percentage.

Nifty has recovered after touching support at 19,300, although it has not yet regained its position above the 20-day exponential moving average (EMA). For the recovery to continue, we must prioritise sustainability over maintenance of the status quo. Even though global indexes are falling, they have not yet reversed their upward trajectory, which is reassuring. In the face of conflicting data, it’s best to proceed with caution and limit the size of your positions.

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Also Read : Technical View | Nifty rebounds, but sustainability above 19,500 key for further sharp upmove

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If the index maintains its position above the current level, it may encounter an initial barrier between 19,600 and 19,700, while 19,300 is expected to be a solid support level on the downside, according to experts.

The Nifty50 opened higher at 19,463 and remained within a 100-point range throughout the session before concluding the week at 19,515, up 135 points. On the daily charts, the index nearly recovered all of its previous day’s losses and formed a bullish candlestick pattern with minor upper and lower wicks and a higher high, higher low formation.

On a weekly scale, however, a bearish candlestick pattern with upper and extended lower shadows has formed, resulting in lower highs and lower lows for the second consecutive week as the index declined 0.66 percent. Until it returns to higher highs and higher lows with less volatility, this is a cause for concern.

“From a technical standpoint, Friday’s pattern indicates a market upswing. The Nifty has been forming a bearish pattern consisting of lower tops and bottoms over the course of the last 6-7 trading sessions, and the current uptrend may be consistent with the formation of a new lower top in the sequence. “However, the lower top reversal must be confirmed,” said HDFC Securities’s Nagaraj Shetti, a technical research analyst.

He believes the development of a high-wave pattern at the market’s highs indicates the market is in a corrective phase with volatility.

“Therefore, the near-term trend of the Nifty remains negative. In the upcoming sessions, the current uptrend may encounter a formidable obstacle between 19,600 and 19,650. The immediate support level is 19,400,” said Nagaraj.

On the Option front, the highest Call open interest was observed at the 19,600 strike, followed by the 20,000 strike, with significant Call writing at the 19,600 strike and then at the 19,900 strike, whereas the highest Put open interest was observed at the 19,400 strike, followed by the 19,500 strike, with a writing at the 19,500 strike and then at the 19,400 strike.

The above data indicated the Nifty may see immediate resistance at 19,600 levels, with support at the 19,400 mark.

Bank Nifty

Bank Nifty has also experienced a recovery, but experts say that until it decisively closes above the 45,800 barrier, it is likely to stay rangebound.

On the daily scale, the Bank Nifty fluctuated by about 600 points before closing 366 points higher at 44,880, forming a small bodied bullish candlestick pattern with minor upper and lower shadows; on the weekly scale, it declined by about 1.3 percent, forming yet another bearish candlestick pattern with lower highs and lower lows.

The 50-day simple moving average (SMA) or 44,500 would be the rock-solid support level for traders. Abol Athawale, vice president – technical research at Kotak Securities, predicted that the index would rise over that level and reach 45,400–45,500.

On the flip hand, he thinks the uptrend is at risk below 44,500 and could retest the 44,300-44,000 barrier below there.

Investment experts’ opinions and advice on Moneypoise.com are their own and do not reflect the views or opinions of the website or its administration. Users of Moneypoise.com are cautioned to consult with qualified professionals before making any financial moves.

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Analysts also noted that the mood in the domestic market was disturbed by prolonged FII selling, which was driven by a spike in US bond yields. Real estate, which has seen sequential revenue decline, joined banks, IT, and financial services stocks as some of the largest laggards. The media and healthcare sectors both saw buying activity.

As of the close of trading, the Nifty 50 index had dropped by 144.90 points, or 0.74 percent, to 19,381.65. Down 0.82 percent, or 542.10 points, the Sensex of the Bombay Stock Exchange ended the day at 65,240.68.

Sun Pharma and Adani Enterprises, both of which are members of the prestigious Nifty 50 index and are scheduled to release earnings later in the day, were among the day’s top gainers. The most percentage declines from the index were seen by ONGC, Titan, and Bajaj Finserv.

Nifty Midcap 100 and Nifty Smallcap 100 both ended the day up, demonstrating the market’s broad strength.

Among industry indexes, Nifty Pharma saw the largest increase in value. In addition to the Dow and the S&P 500, several sectors have shown gains today, including the Media, Healthcare, and Auto sectors. The worst performing sector was Nifty Metal, followed by the Nifty Bank and the Nifty IT.

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