Closing Bell: Nifty below 17,700, Sensex down 184 pts; realty stocks shine

Prashanth Tapse, Senior VP (Research), Mehta Equities

Benchmarks continued to trade lower for the second consecutive session, as investors were seen nervous after the dismal Q4 performance of IT companies, although IT Index recovered after yesterday’s drubbing.

Nifty is likely to trade volatile and choppy with support seen at 17573, while the index may face hurdles at 17863 mark.

Siddhesh Mehta, Research Analyst, SAMCO Securities

Avalon Technology shares listed today at Rs. 431 per share on BSE, down 1.15% from the issue price of Rs. 436 per share.

This is in line with the expectations given the sharp profit booking after a bull run in the market has impacted the listing performance of the company. The overall market sentiment is bearish due to the market volatility which added fuel to the fire and caused listing of the company’s shares at a discount.

Avalon Tech’s debt-to-equity ratio is relatively higher compared to its peers. Also, it generates significant revenue from a limited number of customers which increases revenue concentration. Considering the current market conditions, we had advised our investors to avoid subscribing to the IPO. The company operates in a highly competitive and volatile industry but its revenue growth lagged the industry average.

However, the company is well poised for growth due to long-term growth prospects in the EMS (Electronic Manufacturing Services) Industry. Apart from this, it can also benefit from the PLI scheme which will aid in improving its financials. The investors should look out for opportunities in this company at reasonable valuations once the company’s financials improve.

Rohan Patil, Technical Analyst, SAMCO Securities:

Nifty continued to trade mildly negative within the previous candle range and once again closed above its 9-day exponential moving averagewhich is placed at 17,618 levels on Tuesday April 18. The benchmark index closed at 17,660 levels with a marginal loss of 0.26 percent.

After showing sharp weakness on Monday, Nifty shifted to a follow-through weakness with range bound movement. From the past two trading sessions, the 17,600 level is acting as a demand zone where prices are showing strength and witnessed closing above the same.

The index on the daily chart has retested its channel pattern breakout levels at 17,600 and the index succeeded in holding that for the second consecutive day. The momentum oscillator RSI (14) has also rested its breakout levels and firmly held above 50 levels.

Over the near term, the trend is likely to remain in a bullish to sideways tone as the bullish breakout of a falling channel pattern is still valid. The validity of the bullish pattern stands above 17,500 levels which can be considered an immediate support for the index.

Kunal Shah, Senior Technical & Derivatives Analyst at LKP Securities.

The Bank Nifty index continued to witness sideways momentum and is stuck in a broad range between 42,000-42,500. The options data also confirm where 42000pe and 42500Ce are where significant put writing is visible.

The index as long as it sustains above 42000 will remain in a buy-on-dip mode and if breached will lead to a further correction towards the 41,500 level.

Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas:

The Nifty opened on a positive note and consolidated for most part of the day. It traded within the range 17,863 – 17,574 of the previous trading session. The hourly Bollinger bands are contracting on account of the sideways price action and is also suggesting rangebound price action.

The daily momentum indicator has a positive crossover which is a buy signal. Thus, we are getting divergence signals from price and momentum indicator and this often results in a rangebound movement.

During this phase of consolidation, we can expect sector rotation and stock specific price action. The range of consolidation is likely to be 17,500 – 17,800 for the next few trading sessions.

Ajit Mishra, VP - Technical Research, Religare Broking

Markets oscillated in a narrow range and ended marginally lower, in continuation of Monday’s decline. Meanwhile, a mixed trend on the sectoral front kept the traders busy wherein realty and pharma posted strong gains. Besides, buying in midcap and smallcap further added to the positivity. Amid all, the Nifty index settled at 17,660.15; down by 0.3 percent.

We are seeing reactions largely based on earnings, in absence of any major event. Banking and financials hold considerable weight in the benchmark and their resilience indicates further room for upside. Besides, rotational buying in index majors from sectors like auto, FMCG is providing the needed cushion in between. Considering all, we reiterate our positive view on markets and suggest utilizing this pause to add quality names.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

Markets languished in negative territory for the better part of the trading session and ended weak for the second day in a row as selective profit-taking in banking, power & FMCG stocks weighed. However, buying in realty and metal stocks limited the downside.

Technically, after the gap-up opening, the market saw profit booking at higher levels which were at 17766/60113. We are of the view that 17800/60200 will now act as an important resistance area for the traders. Above that, the market can go up to 17870-18000. On the downside, selling pressure may increase below 17600/59550. Below this, the index may test 17500-17400/59300-59000 levels again. The strategy should be to buy between 17500 and 17450. For this, keep a stop loss at 17400/59000.

For the Bank Nifty 42400 and 42500 would be a resistance zone and support exists at 41800.

Ameya Ranadive, Equity Research Analyst, Choice Broking:

Benchmark indices recovered some of their intraday losses, but the Nifty is still trading below 17,700. On daily charts, the Nifty has managed to hold the 100-day exponential moving average (EMA), which is currently around 17,625. Nifty has seen a good profit booking in the last two days, with a good sell off in the first 15 minutes of trading. For Nifty,17,600-17,550 is a critical support level. If this level is maintained, we may see a slight rebound up to 17,850-17,900.

The Bank Nifty, on the other hand, had a turbulent day, failing to close over 43,300. Bank Nifty is displaying relative strength in comparison to Nifty, having managed to close in positive territory for the last two days. Bank Nifty must maintain 42,000-41,800 as a critical support level whileresistance is seen between 42,800 and 43,000.

Vinod Nair, Head of Research at Geojit Financial Services:

The banking stocks pared the performance during the day while the market was grappling with the sell-off in the IT sector. However, the IT sector experienced a marginal relief rally, aided by bottom fishing, as the recent correction has made the sector attractive for long-term investment.

The pharma sector also bucked the negative trend due to an improvement in outlook along with strong movements in mid and small-cap stocks

Dilip Parmar, Research Analyst, HDFC Securities:

The Indian rupee continues weakening against the US dollar following weak risk appetite and weak regional currencies. The US dollar and Treasuries erased Monday’s gain after better-than-expected Chinese growth numbers, lowering the haven demand.

Spot USDINR has been trading listlessly for the last couple of days and oscillating near 82-odd levels.

In the near term, the pair is expected to trade between 81.70 to 82.50.

Rupee Close:

Indian rupee ended lower at 82.04 per dollar on Tuesday against Monday's close of 81.97.

Market Close:

Benchmark indices ended lower on April 18 with Nifty below 17,700.

At close, the Sensex was down 183.74 points or 0.31 percentat 59,727.01, and the Nifty was down 46.60 points or 0.26percentat 17,660.20. About 1,841 shares advanced, 1,602 shares declined, and 115 shares were unchanged.

Top losers on the Nifty included Power Grid Corporation, UltraTech Cement, Adani Enterprises, Reliance Industries and Apollo Hospitals, while gainers were Divis Labs, HCL Technologies, IndusInd Bank, Cipla and Nestle India.

Among sectors, selling was seen in the FMCG, power and infra names, while pharma, realty up 1 percent each and information technology, PSU Bank and metal up 0.5 percent each.

The BSE midcap index rose 0.5 percent, and smallcap index added 0.2 percent.

Oil slips on economy worries, despite upbeat China data

Oil fell for a second day on Tuesday as upbeat Chinese economic data failed to deflect the focus from a possible increase to U.S. interest rates and wider concern about the growth outlook.

Crude prices were also pressured by the Iraq federal government and Kurdistan Regional Government (KRG) taking a step towards a resumption in northern oil exports from the Turkish port of Ceyhan after they were halted last month.

Brent crude fell 28 cents, or 0.3 percent, to USD 84.48 a barrel by 0908 GMT, giving up early gains. U.S. West Texas Intermediate lost 30 cents, or 0.4 percent, to USD 80.53.

Jefferies View On L&T

-Buy rating, target at Rs 2,650 per share
-Investors appear concerned about pre-election impact on L&T's order flow & share price
-L&T’s order flow rose by double-digits in the last 3 pre-election-year periods
-Order flow rose despite embargo on centre’s ordering activity 6 months prior to elections
-Domestic orders were the dominant share & overseas proportion rose in 2 of 3 periods
-Share price has held up into elections & been muted post
-Diversification & leadership key

Gold climbs as dollar edges lower, markets await Fed rate hike path

Gold prices rose on Tuesday, buoyed by a weaker dollar, while investors looked for more clarity on the U.S. Federal Reserve's rate hike path ahead.

Spot gold rose 0.4 percentto $2,002.72 per ounce by 0909 GMT. U.S. gold futures were also up 0.4percentto $2,015.40.

Jefferies On PSU Banks

-PSU banks have issued Rs 1 lakh core in AT-1 Bonds that form 1.6 percentof RWA
-Market has polarised to larger bank
-Top 4 banks have issued 85percentof total AT-1 bonds with SBI, Canara & PNB leading
-Canara has highest dependence on AT-1s
-Residual term to 'call option' implies Rs 20,000 crore will mature in 2 years, most with SBI

Saumil Gandhi, Senior Analyst - Commodities, HDFC Securities:

Gold prices traded higher on Tuesday, with spot gold prices at Comex were trading up by 0.19percentat USD 2,003.0 per ounce. Gold June future contract at MCX were trading up by 0.33percentat Rs 60,380 per 10 grams by noon session.

Gold prices recovered today after slipped around 2.0 percent in last two trading session. Yellow metal short term trend reversal post Friday’s US macro data as traders predicted that the Federal Reserve will continue its aggressive monetary tightening to curb inflation. That pushed US dollar and Treasury yields higher and weighed on yellow metal.

U.S. Treasury yields, with the 10-year note crossed above its 200-day simple moving average and hitting 3.60 percent, its highest level in nearly three weeks. Higher yields negative for non-yielding metal.

We expect gold price could decline further once Comex spot gold break support of USD 1,980 per ounce. Comex spot gold having supports at USD 1,980/1,965 per ounce and resistances at USD 2,010/2,019 per ounce. MCX Gold June future having support at Rs 59,700 per 10 gram and resistance at Rs 60,580 per 10 grams.

Aviation Data

Domestic air passenger traffic up 21.4 percent YoY at 12.89 million.

In the month of February 2023, IndiGo market share stood at 56.8 percent versus 55.9 percent and Go First market share was at 6.9 percent versus 8.0 percent.

Air India market share stood at 8.8 percent versus 8.9 percent, Vistara market share at 8.9 percent versus 8.7 percent and SpiceJet market share at 6.4 percent versus 7.1 percent.

Market at 3 PM

Benchmark indices erased some of the intraday losses but still trading lower with Nifty below 17,700.

The Sensex was down 163.83 points or 0.27 percentat 59,746.92, and the Nifty was down 42.70 points or 0.24 percent at 17,664.10. About 1,705 shares advanced, 1.574 shares declined, and 86 shares were unchanged.

Sharekhan upgrades Mahindra Logistics to buy with target of Rs 502

Mahindra Logistics remains focused on the turnaround of B2B express business of Rivigo consolidating its express business under MSEPL.

Further, it targets to increase the share of solutions business in 3PL vertical, which would provide better margins. It remains upbeat on end-user demand on medium-term barring e-commerce with focus on expanding margins. It remains committed on adding 2-3msf warehousing capacities per annum.

The stock has seen a correction of 17percentsince the broking house downgraded itto Hold in itsreport dated February 2, 2023."We believe the current valuation at a P/E of 58x/34x its FY2024E/FY2025E earnings aptly factors its transitioning-related uncertainties providing an opportunity to Buy," the brokerage said.

Likewise, Sharekhan upgrade the stock to Buy with an unchanged price target of Rs 502.

South Indian Bank introduces flexible saving accounts for NRI customers

South Indian Bank has introduced flexible savings accounts for its NRI customers, expanding its product portfolio. With this new offering, NRIs can maintain either deposits or the minimum balance required for a savings account, providing them with greater flexibility.

The bank has been committed to streamlining banking services and enhancing the customer experience, with recent initiatives like SIB SEAFARER and SIB PULSE for healthcare professionals and mariners, respectively.

South Indian Bank was quoting at Rs 15.45, down Rs 0.36, or 2.28 percent.

United Spirits rises on report New Delhi City denies Pernod sales

United Spirits' stock prices climbed following a Reuters report that Delhi, India's capital city, rejected Pernod Ricard's application for a liquor sale license.

Invesco predicts global central banks to avoid significant tightening amid banking crisis and growth moderation

In response to the recent banking crisis in the US and signs of growth moderation, Invesco Asset Management India expects that global central banks will likely refrain from significant tightening in the future. This is in line with their base scenario that most global rate hikes are now behind us.

India's RBI has surprised the market by maintaining its current interest rates, as the country experiences a slowdown in growth, particularly in consumption. Invesco believes that India's economic growth will pause in 2023 due to the impact of higher interest rates and a global growth slowdown.

Although Invesco sees a risk of earnings downgrades for FY24 due to moderate growth, they anticipate opportunities for investors to arise in the market for the remainder of the year. They predict that India's next earnings upgrade cycle will begin in mid-2024, as the effects of the global slowdown weaken, and India's structural growth drivers become more prominent. Despite this, Invesco still sees India as an attractive "buy on dips" market for medium-term investors, given the current macro-backdrop.

CRISIL Q4 results

CRISIL Ltd posted a 19.9 percent on year jump in net profit during the January-March period to Rs 145.8 crore as against Rs 121.6 crore in the year ago period. Revenue also grew 20 percent on year to Rs 714.9 crore.

EBITDA margin slightly contracted to 28.5 percent from 29.6 percent in the same quarter last year.

Market at 2 PM

Benchmark indices were trading near the day's low with Nifty around 17600.

The Sensex was down 244.65 points or 0.41 percentat 59,666.10, and the Nifty was down 71.30 points or 0.40percentat 17,635.50. About 1,659 shares advanced, 1,582 shares declined, and 104 shares were unchanged.

Sterling & Wilson bags three orders worth Rs 1,080 crore for rural electrification. The stock was trading at Rs 304, up 6.20 points or 2.05 percent on the NSE.

JTL Industries appoints Dhruv Singla as Chief Financial Officer

As a part of internal re-organization, the board has accepted the resignation of Sanjeev Vaid as Chief Financial Officer of JTL Industries with effect from April 17, and has appointed Dhruv Singla, who is currently a Whole Time Director, as the Chief Financial Officer of the company with immediate effect.

JTL Industries was quoting at Rs 335.00, down Rs 4.25, or 1.25 percent.

CLSA View On Auto companies

-Clients prefer 4-wheeler names over 2-wheeler as demand continues to be stronger
-Maruti Suzuki & Tata Motors are the investors’ favourite 4-wheeler stocks
-Clients like Bajaj Auto in 2-wheeler space for 4 percentdividend yield & upcoming triggers on launches
-Clients have limited interest in auto component names due to punchy valuations

Goa Carbon resumes operations at Bilaspur unit

European markets were slightly higher Tuesday as investors continue to gauge the health of the global economy as well as corporate earnings.

Short Buildup seen in the following stocks

Long Buildup seen in the following stocks

Schaeffler India Q1 results:

Industrial and automotive supplier Schaeffler India on April 18 has recorded 5.9 percent year-on-year growth in profit at Rs 219.4 crore for quarter ended March 2023, driven by other income but lower operating margin limited profitability.

However, the net profit margin declined 26 bps YoY to 12.95 percent for the quarter.

Revenue from operations for the quarter at Rs 1,694 crore grew by 8 percent, the company said in its filing to exchanges. The YoY growth was aided by its automotive business.

The company follows January-December as its financial year.

"The automotive technologies and automotive aftermarket business registered strong YoY growth. Our balanced business portfolio and focus on operational efficincies helped us to mitigate the external headwinds resulting in resilient margins," Harsha Kadam, Managing Director said.

Nifty Pharma index added 1 percent supported by Lupin, Biocon, Aurobindo Pharma

Market at 1 PM

The Sensex was down 15.12 points or 0.03 percentat 59,895.63, and the Nifty was up 0.40 points or flatat 17,707.20. About 1,838 shares advanced, 1,359 shares declined, and 107 shares were unchanged.

Ramco Systems partners with Shearwater Health to digitally transform the HR and payroll operations for its employees.

Dredging Corporation of India appoints TK Ramachandran as

Dredging Corporation of India's board of directors has approved an appointment of T K Ramachandran as Chairman of the company for six months with effect from April 1. T K is currently the Chairperson of V O Chidamabaranar Port Authority.

Dredging Corporation India was quoting at Rs 305.40, down Rs 1.25, or 0.41 percent.

Bank of Maharashtra hikes lending rates by 10 bps across tenures

Bank of Maharashtra has raised the marginal cost of funds based lending rate by 10 bps across tenures, with effect from April 15.

Bank of Maharashtra was quoting at Rs 28.50, down Rs 0.18, or 0.63 percent on the BSE.