Taking Stock: Nifty holds 12,000 levels on F&O expiry; Sensex down 300 points
Indian market witnessed a selloff on the F&O expiry day on Thursday weighed down by muted global cues as the death toll from coronavirus rose t0 170 in China.
Rahul Mishra, AVP (Derivatives), Emkay Global Financial Services:
All eyes will be on union budget, scheduled on 1st Feb, Saturday. Markets will be remain open on account of budget. Though any significant up move (3%-5%) is unlikely; any disappointment to improve the economy will pull down the market. Nifty has failed to sustain above 12400 level in the recent past and we may see profit booking at higher level. LTCG, Dividend Distribution Tax (DDT), Cut in Personal Income tax will be the key announcements investors are looking forward to in the budget. FIIs total positioning in Index future has doubled during the month of January; they have reduced their long position by 20% while short position has been increased by 46%. Even in Stock future they have added 28% on short side while a small addition of 5% seen on long position. Derivative universe shrinks further with four more stock went out of F&O segment. Future contracts will not be available in Castrol, Dish TV, NBCC and Tata Motors DVR. FII’s net cash flow has turned negative for January after three consecutive months with positive outflow.
Shrikant Chouhan, Senior Vice-President, Equity Technical Research, Kotak Securities:
The market witnessed selling pressure today on account of January F&O expiry, which has been volatile so far with a swing of around 500 points. Besides, weak global cues and sharp selloff in Pharma, Energy and FMCG gave bears the ammunition to retain their negative stance over long. We are of the view that the market will remain volatile throughout the week. Technically, the Nifty is still holding the trend line support of 12000, indicating that the short-term uptrend is still intact and a strong possibility of a quick pull-back rally above 12060 is not ruled out. The 12110 and 12190 levels should act as immediate resistance for the index, whereas, trading below the psychological support of 12000 could trigger another correction wave up to 11940-11900. Ahead of budget, the sectors which would be in focus are Banking, Infrastructure, FMCG, Auto.
Kotak Mahindra said promoters' voting rights in the bank will be capped to 15 percent from April 1 onwards and promoters' shareholding will be cut to 26 percent within six months from the final RBI nod.
Ajit Mishra, VP - Research, Religare Broking:
After a minor pause on Wednesday, the downtrend resumed as the Indian equity benchmark indices ended Thursday’s session on a negative note, amid muted global cues. The Nifty index ended sharply lower by 0.8% at 12,036 levels. The broader markets, BSE-Midcap and Smallcap too ended in red with losses of 1.3% and 0.9%, respectively. All the sectoral indices witnessed selling pressure, wherein FMCG, Oil & Gas and Healthcare were the top losers.
We expect markets to remain volatile in the near term given the earnings season and nervousness surrounding the crucial event - Union Budget. Further, the release of Auto sales numbers for the month of January (scheduled on Feb 1st) will remain on the market radar. We believe investors can utilize any correction to invest in fundamentally sound companies with strong growth prospects.
Vinod Nair, Head of Research, Geojit Financial Services:
Fears of economic slowdown as the coronavirus spreads to other nations has dampened the mood of investors across the globe. A slew of results announced so far failed to provide a picture of economic revival with banks disappointing due to weak asset quality that triggered profit booking. With expectations high, the market to stay focused on the upcoming budget for further green shoots in the economy.
Blue Star Q3 result: Net profit at Rs 19.6 crore versus loss of Rs 0.9 crore and revenue up 12.5% at Rs 1,236 crore versus Rs 1,099 crore, YoY
Market Close: After witnessing bounce back in the previous session, the Indian indices gave up all that gains on January F&O expiry day with Nifty closed below 12,100 level.
At close, the Sensex was down 284.84 points at 40913.82, while Nifty was down 93.70 points at 12035.80. About 817 shares have advanced, 1591 shares declined, and 159 shares are unchanged.
Yes Bank, Reliance Industries, Bajaj Finserv, Wipro and Hindalco were among major losers on the Nifty, while gainers were Bajaj Auto, Power Grid, ICICI Bank, NTPC and Eicher Motors.
All the sectoral indices ended lower led by the pharma, metal, bank, energy, FMCG and infra.
Kirloskar Industries Q3 result: Net profit down 22.4 percent at Rs 15.16 crore versus Rs 19.53 crore and revenue was down 21.8 percent at Rs 457.2 crore versus Rs 584.9 crore, YoY.
Indian Oil Corporation Q3 result: The company's standalone net profit at Rs 2,339 crore against Rs 563.4 crore and revenue was up 11.6 percent at Rs 1.24 lakh crore against Rs 1.11 lakh crore, QoQ.
The Indian stock market jilted by the outbreak of the coronavirus in China have spooked investors fearing that the virus outbreak may derail the pace of economic growth.