Closing Bell: Sensex, Nifty end higher amid volatility; PSU banks drags, Hindalco top gainer

Taking Stock | Sensex Up 222 Points, Nifty Above 15,150; Smallcaps Shine

Hindalco Industries, Reliance Industries, Sun Pharma, Adani Ports and GAIL were among the major Nifty gainers, while losers included Eicher Motors, Titan Company, NTPC, L&T and Tata Motors.... Read More

The Nifty / Sensex closed at the highest point of the day on the weekly closing of the index options. Index giant Reliance Industries has pulled the market sentiment otherwise the market participants were more interested in small-cap stocks throughout the day. Today, the Nifty Small-Cap Index surged and more than 60 percent of the stock closed in the positive territory.

Based on the market closing, we can conclude that the market is consolidating and would remain volatile between the 15200/51700 and 15000/51100 levels until the market closes at the 15200/51700 level. The Nifty would move above the 15200/51700 level to 15350/52200, however, in the absence of Bank-Nifty performance, the market will need strong support from FMCG or IT sectors with consolidation and large support available.

Markets ended with modest gains in a volatile trading session. After the initial downtick, the benchmark recovered in no time and remained range-bound thereafter. It finally settled around the upper band of the range to close at 15,173 levels. The mixed trend continued on the sectoral front as Capital Goods, Consumer Goods and Auto ended with losses whereas Oil & Gas, Metal and Telecom ended with gains. Amid all, the broader indices witnessed healthy traction as both midcap and smallcap ended higher by 0.4% and 1%.

We reiterate our bullish view on markets however traders should maintain extra caution in the selection of stocks now. Participants would be actively tracking key macroeconomic data like IIP, CPI and WPI data for cues on Friday. A decisive break above 15,250 would trigger further up move else consolidation will continue.

The domestic market closed with slight gains after its range-bound rally, tracking gains in index heavyweights and positive European & Asian markets. The upward movement in the market was supported by energy, telecom and FMCG stocks with small caps outperforming. Dip in January auto retail sales numbers pushed the sectoral index into the negative territory while PSU banks also remained under pressure.

Indian rupee ended flat at 72.86 per dollar, with domestic equity market closes higher in the volatile session.It opened marginally higher at 72.81 per dollar against previous close of 72.84 and traded in the range of 72.65-72.87.

Index closed a day on a positive note at 15,173 with gains of half a percent, the index has formed a range and it’s trading within the same range last four sessions. The overall range for Nifty is coming at 15k on the downside and 15,250 on the higher side, so unless we see either side breakout, final direction will not be clear and index may trade sideways in the same range.

Benchmark indices ended higher on February 11 after witnessing consolidation in the previous two sessions.

At close, the Sensex was up 222.13 points or 0.43% at 51,531.52, and the Nifty was up 66.80 points or 0.44% at 15,173.30. About 1711 shares have advanced, 1229 shares declined, and 133 shares are unchanged.

Hindalco Industries, Reliance Industries, Sun Pharma, Adani Ports and GAIL were among major gainers on the Nifty, while losers were Eicher Motors, Titan Company, NTPC, L&T and Tata Motors.

Except auto and PSU bank, other sectoral indices ended in the green. BSE Midcap and Smallcap indices rose 0.4-1 percent.

Some lackluster movement witnessed in the market. Nifty 50 Index is still trading below the resistance level of 15250. The breakout above 15250 is critical for the index to regain its upside momentum. Therefore, the short-term traders should use the rally to exit while buying any dip towards the support level around 14900-14800.

The momentum observed in the indicators like RSI, MACD to continue showing divergence, supporting the view that the market is likely to take a pause around this level and stay in a range.

Company boatd approved issue of 1 bonus share for every 1 equity share held by the equity shareholders of the company as on "record date". The bonus issue of equity shares is subject to the approval of the shareholders and other applicable statutory and regulatory approvals, as may be required. The company will intimate the "record date" for determining eligible shareholders entitled to
receive bonus shares, in due course.

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Natural Gas March expiry contract is currently trading near $2.98, ahead of the weekly inventory report today. The market expects a drop of 184 bcf. Current Natural Gas inventories are up +3.1% y/y, and are +7.9% above the 5-year average. Inventories for the week of January 29 fell -192 bcf, to an 8-1/4 month low of 2,689 bcf.

The Commodity Weather Group on Wednesday said that cooler-than-normal temperatures in the U.S. would extend until at least through February 19. Natural Gas prices are likely to trade firm on much cooler than normal weather forecast. However, the Commodity Weather Group has forecasted that the current Arctic temperatures in the U.S. would recede between February 20-24.

According to the Short-Term Energy Outlook (STEO) report, the EIA Average Natural Gas spot prices at Henry Hub are expected to rise to $2.98/MMBtu this month, a 27-cent increase over January prices, and sharply higher than the $2.59 December average.

Natural gas prices are likely to trade firm, on the back of robust export demand, domestic consumption, and slower production. As per Bloomberg data, Gas flows to U.S LNG export terminals on Tuesday rose +21% y/y, to 10.6 bcf. Natural Gas demand on Wednesday rose +12% y/y, to 104.4 bcf. US electricity output in the week ended February 6 rose +5.9% y/y, to 79,582 GWh (gigawatt hours). US gas production on Wednesday was down -4.7% y/y at 89.397 bcf/d.

Natural Gas prices are likely to trade firm, while above the key support level of the 20-days EMA at $2.78, and the 50-days EMA at $2.62, while immediate resistance is seen around $3.12-$3.26 levels.

Company's consolidated net profit fell 21.4% YoY at Rs 3,085.4 crore against Rs 3,924 crore and revenue was up 2.1% at Rs 23,686 crore versus Rs 23,190.5 crore.