Closing Bell: Market ends flat amid high volatility; bank, metal drag, oil & gas gains

The benchmark indices witnessed volatile trading session, the Nifty ends 9 points lower while the Sensex was down by 37 points. Among sectors, profit booking continued in Metal and Financial stocks, both indices registered profit booking at higher levels. Whereas, some buying was seen in selective Pharma and IT stocks.

Technically, after a sharp fall the index opened in the green but corrected sharply. After early morning selloff the index witnessed range bound activity. Lower top formation intraday charts and bearish candle on daily charts indicating continuation of weakness in the near term.

However, momentum indicators suggesting strong possibility of pullback rally from the current levels. We are of the view that, the bearish sentiment in the market is still intact and fresh pullback rally possible, if the index succeeds to trade above 200-day SMA (Simple Moving average) or 16940/56950. Above which, the index could retest the level of 17150-17200/57500-57700.

On the flip side, below 16940/56950, it could slip till 17850-17800/56600-56500. The intraday texture of the market is non directional, hence level based trading would be the ideal strategy for the day traders.

The benchmark Nifty remained range bound ahead of the RBI policy meet. The index briefly slipped below 16950 as it failed to sustain at the lower level leading to a close above 17000. On the lower end, bulls have managed to protect the 200 DMA on a closing basis.

The momentum indicator is in a bearish crossover. The trend remains weak; however, the proximity to the crucial support may induce a pullback in the market.

On the higher end, resistance is visible at 17150-17200. Above 17200, the Nifty may move towards 17500. On the other hand, a decisive fall below 16950 may trigger a panic button.

Benchmark Indices closed slightly down with Nifty 50 closing -0.05% down and Sensex closing -0.07% down today. Selling pressure was witnessed in Auto, financial, capital goods and power stocks while some buying was witnessed in Pharma, FMCG and IT stocks.

IT stocks are showing strength from past few sessions with strengthening of USD against INR. IT companies result will start coming from Mid Oct and it may trigger the next move in this sector. Investors should start accumulating good quality IT stocks in a staggered manner.

On the technical front immediate support and resistance in Nifty 50 are 16800 and 17400 respectively. Immediate support and resistance in Bank Nifty are 38000 and 39000, respectively.

In search of a safer dollar and elevated bond yields, foreign investors are withdrawing from Indian equities, resulting in the decline of the domestic market.

In contrast to the recent trend of sector performance, banks and autos are exhibiting negative bias, while IT and pharma are showcasing resilience. Crude price are closing down, despite expectations that OPEC+ will take more action to cut production in the coming meeting, due to weakening global economy.

It is time for the bond market to take one for the rupee. The fact that the MPC may hike policy rates by 50 bps instead of 35 bps is not necessarily a game changer for bond markets. In fact, it is a small price to pay for managing currency volatility.

Indian rupee ended higher at 81.57 per dollar against previous close of 81.62.

Benchmark indices ended on flat note in the highly volatile market on September 27.

At Close, the Sensex was down 37.70 points or 0.07% at 57,107.52, and the Nifty was down 8.90 points or 0.05% at 17,007.40. About 1836 shares have advanced, 1483 shares declined, and 125 shares are unchanged.

Cipla, Tata Consumer Products, BPCL, Power Grid Corporation and Shree Cements were among the top gainers on the Nifty. Losers included Hero MotoCorp, Adani Ports, Titan Company, Tata Steel and Kotak Mahindra Bank.

Selling was seen in capital goods, power, auto, metals and financial names, while buying was seen in pharma, oil & gas, FMCG and IT names.

BSE midcap index ended on flat note, while smallcap index gained 0.5 percent.

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We expect Alicon’s earnings to report a robust 118% CAGR during FY2022-FY2024E, led by a 27% revenue CAGR and a 300-bps improvement in EBITDA margin to 13.4% in FY2024E from 10.4% in FY2022.

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Potential merger of Veeral Additives (VAPL) with Vinati remains a key catalyst for the stock in FY23.

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