Closing Bell: Nifty ends around 17,050, Sensex falls 337 pts; PSU bank, metal, IT worst hit

Taking Stock | Profit booking for fourth day drags Nifty below 17,000; Sensex falls 338 points

All the sectoral indices ended in the red with power, realty, information technology, PSU Bank, metal and auto falling 1-2 percent.... Read More

Markets inched further lower and lost over half a percent, in continuation to the prevailing trend. After the initial decline, Nifty tried to recoup losses in the middle but selling pressure in index majors from IT, banking and energy pack pushed the index to a newer low. It slipped below the psychological mark of 17,000 levels for a brief and finally settled at 17,043.30 levels. The broader indices traded in tandem and lost in the range of 0.5%-08%.

Markets are dancing to the global tunes and we’ll see the reaction to the US inflation in early trade on Wednesday. Indications are in the favor of some breather after the recent slide but the upside seems capped too. Meanwhile, participants should stay light and focus more on risk management.

Domestic indices saw roller coaster ride amid continued global uncertainty. Nifty opened flat but soon witnessed selling pressure. Nifty drifted below 17k zone for a brief moment intraday – almost after more than 4 months – it was below 17k last time on 13 Oct 2022. Nifty finally ended the day with loss of 111 (-0.7%) at 17043 levels.

The only positive factor today was the WPI data for Feb’23, which came in at 25-month low at 3.85%. Except Pharma, all sectors ended in red.

Markets are likely to remain under pressure in the near term, as the US banking crisis deepens with more and more US banks coming under the cloud. Now all eyes will be on the US inflation data that will be released late on Tuesday and would be key factor for the Fed’s decision on interest rate in its upcoming meeting amidst the ongoing banking turmoil.

The Nifty witnessed a volatile trading session today. It witnessed sharp swings in both directions and ultimately closed in the negative, down 111 points for the day. It is the fourth consecutive negative close for the Index. It has corrected around 800 points during this period and hence a relief rally cannot be ruled out.

The momentum indicator has a negative crossover which is a sell signal and with prices trading along the expanding lower Bollinger band suggests that the fall is likely to continue. The preferred strategy to trade in Nifty would be to sell on rise around 17,150 – 17,200 zone. On the downside we expect the Nifty to target levels of 16,950 where the lower end of the downward sloping channel is placed. On the upside, 17,380 – 17,400 where the 40-hour moving average is placed should act as an immediate hurdle zone from short term perspective.

The selling continued while the degree of ambiguity over the US Banks reduced due to supportive measures announced by the US FED. The underlying issue of the market is high interest rates, which will continue to wreak havoc in the world economy.

Yields will take time to moderate to the long-term trend given hawkish monetary policy & high inflation.

However, the disruptive development in the US Banks and slowing economy have created a precursor to presume that yields will peak in the near future, supported by a change in monetary policy from hawkish to neutral, which will diminish the worries of long-term investors.

Indian rupee ended 37 paise weak at 82.49 per dollar against previous close of 82.12.

Indian benchmark indices ended lower for the fourth consecutive session on March 14 with Nifty around 17,050.

At close, the Sensex was down 337.66 points or 0.58% at 57,900.19, and the Nifty was down 111.00 points or 0.65% at 17,043.30. About 1173 shares advanced, 2257 shares declined, and 109 shares unchanged.

Adani Enterprises, Adani Ports, M&M, TCS and HDFC Life were among the major losers on the Nifty, while gainers were BPCL, Titan Company, Bharti Airtel, SBI Life Insurance and Larsen & Toubro.

All the sectoral indices ended in the red with power, realty, information technology, PSU Bank, metal and auto fell 1-2 percent.

The BSE midcap index fell 0.5 percent and smallcap index fell 0.8 percent.

the Board of Directors of Apollo Pipes considered and approved the issue and allotment of up-to 47,20,000 fully convertible warrants of face value of Rs 10 each carrying a right exercisable by the Warrant holder to subscribe to one equity share per warrant to persons belonging to ‘Promoter & Promoter Group’ and ‘Non-Promoter’ Category on preferential basis at an issue price of Rs 550 aggregating upto Rs 2,59,60,00,000.

Apollo Pipes was quoting at Rs 550.65, up Rs 1.85, or 0.34 percent.

-Buy rating, target at Rs 508 per share
-Management highlighted that demand remains strong across JLR, CV & PV businesses
-Management started witnessing a softening of demand in PV business with rising dealer inventory
-JLR's order book remains at healthy levels with steady improvements
-Management believes that Q1FY24 CV volumes can be impacted due to pre-buying in Q4FY23
-Management expects volumes to stabilise from Q2FY24

Tata Motors was quoting at Rs 417.00, down Rs 5.40, or 1.28 percent.

Axita Cotton has received an order from Taraspinning Mills Limited, Bangladesh and Khadiza Sadek Spinning Mills Limited, Bangladesh for Indian Raw Cotton value aggregating at $2,716,091.84. Order needs to be delivered by April 30, 2023, said the company.

Axita Cotton was quoting at Rs 56.46, up Rs 0.53, or 0.95 percent.

India’s wholesale inflation eased to a 25-month low of 3.9% in February, led by moderation in manufactured goods inflation. The low print for manufactured goods inflation (1.9%) was mainly because of deflation in textile and metals categories on an annual basis.

A lower manufactured food and chemicals inflation also helped. However, a higher print for food inflation limited the downside in overall wholesale inflation.

However, there has been a second consecutive month of gain in sequential momentum for wholesale prices due gain in metals and food prices (mom). A sharp uptick in sequential momentum was also visible for coal and mineral oils.

While we expect WPI inflation to ease further in coming months due to the high base, any strong rebound in global commodity prices will remain a key monitorable. Favourable base could help WPI inflation turn negative in May and June 2023. For the next fiscal, we expect the wholesale inflation to ease below 3%. A lower WPI print would also support downtrend in retail inflation.