Closing Bell: Nifty ends above 16,900, Sensex gains 765 pts led by metal, pharma, banks

Ajit Mishra, VP - Research, Religare Broking:

Markets regained momentum and settled with gains of nearly one and a half percent, tracking firm global cues. After the gap-up start, the benchmark gradually inched higher as the day progressed wherein the sectors, barring IT, contributed to the move. Finally, the Nifty closed around the day’s high at 16,931 levels. The broader market indices, midcap and small-cap, too ended with healthy gains in the range of 1.5-1.9%.
 
The surge in the index was led by banking and financials pack today, which look upbeat to maintain the bias. Going ahead, the upcoming macroeconomic data i.e. GDP numbers and auto sales numbers will be in focus for further cues on economic recovery. We expect the prevailing uptrend to continue and suggest keeping the focus on the selection of stocks.

Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities:

Key benchmark indices witnessed a spectacular rally, with benchmark Nifty rallying over 200 points after the breakout of 16700 level. The texture of a breakout continuation formation suggests an uptrend wave is likely to continue in the near future. For the day traders, the support has shifted from 16700 to 16800-16850 levels. 

On the flip side, markets may take temporary pause near 17000-17050 levels due to an extended rally, while intraday charts suggest the market is in an overbought situation. As long as the index holds 16800 level, the uptrend formation could continue up to 17000-17050 levels, whereas on the down side, below the 16800 level uptrend would be vulnerable.

Sachin Gupta, AVP Research at Choice Broking:

After a gap-up opening, the benchmark index continued the upside move and set a new lifetime high at 16951.5 levels on Monday's trading session. The Nifty gained more than 200 points in a day to close at 16938.30 levels, while Bank Nifty ended at 36347.65 levels with 2.00% gains. All the sectoral indices closed at green notes, except Nifty IT, which was down by 0.6%. 

Stocks like Tata Steel, Axis Bank, Divis Lab, Bharti Airtel were the top gainers while Tech Mahindra, Nestle, Infosys were the prime laggards. On the daily chart, the nifty50 index has breached the prior resistance of 16700 and moved towards the new milestone of 17000 marks. 

Moreover, the index has also closed above the upper band of the Bollinger formation, which suggests a bullish presence in the counter. The index has been trading above all the important key indicators, which adds positive strength further. At present, the Nifty index has immediate support at 16700 levels while resistance may come around 17000 levels.

Rohit Singre, Senior Technical Analyst at LKP Securities:

Strong move has been witnessed on the first day of the week and the index closed a day on fresh highs at 16,931 with gains of nearly one & a half percent forming a strong bullish candle on the daily chart. 

The index reached its immediate targets of the 17k mark, so traders are suggested to lock some gains near the 17k mark, also fresh buying will be suggested on a dip near 16850 zone and not here as risk rewards will not be in favour. 

Immediate support for Nifty is coming near 16850-16770 zone and if managed to hold above-said levels we may see the index to breach 17k mark and resistance is coming near 17k mark.

S Ranganathan, Head of Research at LKP securities:

Indices & stocks surged through the day on positive global cues buoyed by the FED commentary. The rally today was pretty much broad-based as expectations on the first quarter GDP numbers slated to be released tomorrow aided investor sentiment. 

Afternoon trade witnessed the rally gathering momentum as indices rose 1.5% with several stocks across sectors in the broader markets participating including Exchanges.

Narendra Solanki, Head- Equity Research (Fundamental), Anand Rathi Shares & Stock Brokers:

Indian markets started on a positive note following positive Asian market cues on back of US Fed chairman statement indicating that the central bank is likely to begin tapering before the end of the year, though there is still much ground to cover before rate hikes. 

During the afternoon session markets continued to trade positive and scaled new highs with broad based buying in blue chip counters. 

In another positive development, Niti Aayog Vice-Chairman has said a strong economic growth rebound is expected on the back of rapid vaccinations, a recovering monsoon boosting agricultural output, thrust on infrastructure investments by the government, and growth in export, which have performed remarkably during April June registering a growth of 18% over the same period in the pre-pandemic year of 2019-20.

Vinod Nair, Head of Research at Geojit Financial Services:

Following a strong gap-up opening, equity benchmark indices maintained the trend throughout the day in line with the strength in global markets. Global markets strengthened as the anxiety over the Jackson Hole symposium subsided following the dovish tone of the Fed Chair. Jerome Powell stated to stick with the wait-and-see approach giving reassurance that the easy money policy will continue this year with a smaller rate of tapering.

Market Close: Benchmark indices gained over 1 percent and closes at fresh record highs amid positive global cues.   At close, the Sensex was up 765.04 points or 1.36% at 56,889.76, and the Nifty was up 225.80 points or 1.35% at 16,931. About 2067 shares have advanced, 998 shares declined, and 149 shares are unchanged.   Bharti Airtel, Divis Labs, Axis Bank, Tata Steel and Coal India were the top Nifty gainers. Tech Mahindra, Eicher Motors, Nestle, Infosys and TCS were among the top losers.   Among sectors, except IT, all other indices ended in the green with metal, pharma, PSU Bank rising 2 percent each. BSE midcap and smallcap indices rose 1.5 percent each.

Marwadi Shares and Finance view on Ami Organics IPO:

Considering the FY-21 adjusted EPS of Rs 14.82 on post-issue basis, the company is going to list at a P/E of 41.16 with a market cap of Rs 22,227 mn while its peers namely Aarti Industries and Hikal are trading at a P/E of 54.20 and 46.13 respectively. 

We assign a “subscribe” rating to this IPO as the company has a strong and diversified product portfolio supported by strong R&D and process chemistry skills and is available at reasonable valuation as compared to its peers.  
 

Nifty PSU Bank index added over 2 percent supported by the J&K Bank, SBI, Canara Bank:

Yash Gupta, Equity Research Analyst, Angel Broking

Ami Organics IPO to open on 1st September 2021 with an issue size of Rs 570 crore, the price band of the IPO is Rs 603-610 and a lot size of 24 shares. We have seen some fluctuations in the grey market premium for Ami Organics IPO, as per the different market news currently Grey market premium for Ami organics is at Rs 50 which is 8.2% of IPO price, so the grey market is not suggesting any big listing for Ami Organics IPO.

Ami Organics IPO size is Rs 570 crore consists of fresh issues of Rs 200 crore and an offer for sale of Rs 370 crore (60.6 Lk shares. The company has fixed the IPO price at price to earning of 35.5 times of FY2021 earning, we believe that all the short-term positives have been priced in.

Ami organics is a Gujarat based specialty chemical manufacturer, deals in different types of Advanced Pharmaceutical Intermediates and Active Pharmaceutical Ingredients (API) and materials for agrochemical and fine chemicals. Ami Organics has 3 manufacturing facilities with an aggregate installed capacity of 6060 Mtpa. 

The company has developed over 450 pharma intermediates across 17 key therapeutic areas i.e. anti-retroviral, anti-inflammatory, anti-psychotic, anti-cancer, anti-Parkinson, anti-depressant, and anti-coagulant. Ami organic reported revenue growth of 41% in FY2021 at Rs 342 crores and profit after tax growth of 96% in FY2021 at RS 54 crore. 

The company has a good return ratio, return on capital employed 25.25% and return on net worth at 32.35%. We have a neutral outlook for Ami organics IPO.

OPEC+ likely to keep oil output policy from September unchanged: Sources

OPEC+ is likely to keep its oil output policy unchanged when the group meets on Wednesday and continue with its planned modest production increase, three OPEC+ sources told Reuters.

The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, collectively known as OPEC+, will meet on Sept. 1 to discuss the previously agreed increase of 400,000 barrels per day (bpd) for the next several months.