Closing Bell: Nifty at 21,700, Sensex up 179 pts; IT, capital goods rally

Indian equity indices ended higher on the second consecutive day on January 5 with Nifty around 21,700. At close, the Sensex was up 178.58 points or 0.25 percent at 72,026.15, and the Nifty was up 52.20 points or 0.24 percent at 21,710.80.

We wrap up today's edition of the Moneycontrol live market blog, and will be back on Monday morning with all the latest updates and alerts. Please visit https://www.moneycontrol.com/markets/global-indices/ for all the global market action.

Buying in select frontline stocks helped markets end in positive territory for a second straight session as Sensex ended above the crucial 72000 mark. As valuations are getting expensive, investors are taking exposure to select frontline stocks with focus shifting to corporate earnings season.

Markets traded volatile and ended marginally higher amid mixed cues. After the initial uptick, Nifty drifted gradually lower and oscillated in a range till the end. Meanwhile, a mixed trend continued on the sectoral front wherein recovery in IT majors and follow-up buying in select heavyweights kept the traders occupied. The broader indices managed to edge higher for yet another session wherein smallcap gained over half a percent.

Nifty is likely to spend some more time within the 21,500-21,800 zone citing mixed cues but tone is likely to remain positive. Traders should thus maintain their focus on stock selection and risk management. In absence of any major event, the performance of the global indices especially US would remain in the focus for cues in the coming sessions.

Following a rapid rebound from its positional support at 21500, bullish activity has resumed in the market, with buying interest evident during dips. The prevailing sentiment is bullish, but Nifty encounters initial resistance at 21750, facing selling pressure. Immediate support rests at 21600. A conclusive close above 21750 levels could propel Nifty towards the 22000 mark, signaling further upward movement.

Exhibiting a robust recovery from the 47500 support level, Bank Nifty showcases active bullish activity, rebounding from the 14-day moving average support at 47800. A closing above 48200 is crucial, as it could propel the index towards 48500 and 48800 levels. The immediate support for Bank Nifty stands at 47800, indicating a key level to monitor in the current market scenario.

The market ended on a flat note, tracking weak global cues, with the US 10-year yield edging higher ahead of the release of US payroll data later today, which may shape the expectation for the FED policy. Investors are also staying cautious ahead of eurozone inflation data today. On the domestic front, the market is moving towards the results season, and we expect the exuberance of the broader index may be tested if the December quarter earnings do not justify the valuation.

The Nifty opened gap up however it was unable to sustain at higher levels and witnessed intraday correction. On the way down it managed to hold on to the key hourly moving averages placed in the range 21630 – 21650 and bounced back to close with decent gains. Going ahead we expect Nifty to trade within the range 21500 – 21850 over the next few trading sessions. A decisive break of this range on either side shall set the trend going ahead. Overall. the structure is still in favor of the bulls however a consolidation is likely over the next few trading sessions.

Bank Nifty consolidated within a broad range 48640 – 47480 and witnessed a volatile day of trade. In the process it has held on to the support of 47800 where support in the form of the 20-day moving average is placed. Once this range bound action is complete we can expect the next leg of upmove to resume. On the upside we expect 49500 from short term perspective.

Indian rupee ended higher at 83.16 per dollar versus previous close of 83.23.

Indian equity indices ended higher on the second consecutive day on January 5 with Nifty around 21,700.

At close, the Sensex was up 178.58 points or 0.25 percent at 72,026.15, and the Nifty was up 52.20 points or 0.24 percent at 21,710.80. About 1798 shares advanced, 1494 shares declined, and 62 shares unchanged.

Top gainers on the Nifty were Adani Ports, L&T, TCS, SBI Life Insurance and LTIMindtree, while losers included Nestle India, Britannia Industries, UPL, Sun Pharma and JSW Steel.

Among sectors, Information Technology and Capital Goods indices rose 1 percent each, while pharma, and PSU Bank indices down 0.3 percent each.

BSE midcap index flat, while smallcap index added 0.6 percent.

-Underweight call, target Rs 250 per share
-Gross loan growth was 5 percent QoQ (20 percent YoY), broadly steady (QoQ)
-Retail loan growth moderated while non-retail loan growth improved
-Retail deposits rose 4 percent QoQ, steady versus prior quarter while liquidity reduced

The dollar rose on Friday, heading for its steepest weekly rise since May as traders scaled back expectations of early interest rate cuts this year ahead of U.S. payrolls data later in the day.

The U.S. currency's strong start has cast a shadow on the euro ahead of euro zone inflation data at 1000 GMT, and on Japanese yen, each down around 0.3% against the dollar.

The dollar's rebound will be tested by the nonfarm payrolls report due later in the day. Economists polled by Reuters forecast that 170,000 jobs were created in December, fewer than the 199,000 in November.

The dollar last rose 0.24% against a basket of currencies to 102.68, after touching a fresh three week high. The index is up 1.3% for the week, its strongest performance since the week ending May 15.

-Initiate buy call, target Rs 800 per share
-Mastering asset-light model for sustained profitability
-Thrust on off-book strategy and phygital distribution a big enabler
-Efficient liability management; credit rating upgrade on the cards
-Levers present to mitigate the rise in borrowing costs, NIM outlook stable
-Company-lending improves the quality of earnings; partnerships leveraged well
-Primed for a 25 percent AUM CAGR with 20 percent+ RoE

Sensex Today | BSE Capital Goods index up 1 percent led by Schaeffler India, Hindustan Aeronautics, Lakshmi Machine Works:

-Initiate buy call, target Rs 580 per share
-Revving up for long-term scale
-Robust execution by leadership team should drive industry leading returns
-Favourable urban infra trends; positive for those with capacity & capability
-Three-pillar strategy to drive long-term value; allay investor concerns on gaps
-See increased scope for company to incubate & expand into new areas
-Company could leverage its Rs 2,500-3,000 crore operating cash flow in FY23-26

Supriya Lifesciences announced that its manufacturing site in Lote Parshuram has received Good Manufacturing Practice (GMP) certificate from the Regulatory Authority of Brazil, ANVISA.

Sensex Today | Market at 3 PM

The Sensex was up 128.71 points or 0.18 percent at 71,976.28, and the Nifty was up 54.40 points or 0.25 percent at 21,713. About 1717 shares advanced, 1558 shares declined, and 76 shares unchanged.

Maharashtra government to revive wine industrial promotion scheme for five years, including refunding rebates to wineries that have paid 20% VAT for the past four years, as reported by Hindustan Times.

Gold was headed on Friday for its first weekly drop in four, as reduced bets for an early interest rate cut in the U.S. boosted the dollar and bond yields, while investors awaited a key employment report.

Spot gold was little changed at $2,042.89 per ounce, as of 0810 GMT. It has declined about 0.9% so far in the week.

U.S. gold futures were flat at $2,049.80.

-Initiate buy call, target Rs 3,600 per share
-A credible defence compounder in the making
-Sharpened policy focus to compress USD 60 billion opportunity into 5-7 years
-New orders to see material step up with revenues rising at 16 percent CAGR
-Own-design manufacturing to drive high double-digit EPS CAGR & 20 percent RoE
-Think company is set to triple its order book from Rs 0.8 lakh crore in FY23 to Rs 2.4 lakh crore in FY26
-Believe company is on course to re-rate by a similar magnitude to BHEL in past decade

Sensex Today | BSE Oil & Gas index trading in the green supported by HPCL, Indraprastha Gas, Indian Oil Corporation:

-Underweight call, target Rs 129 per share
-Retailisation of loan book and retail loan book growth continue on track
-Await further details about margins, credit costs, asset quality, etc, in Q3FY24 results
-Company appears to be moving in right direction for long-term, but valuation looks expensive

The Board of Directors of Kaveri Seed Company approved the proposal for buyback of fully paid up equity shares of the company having a face value of Rs 2 from all shareholders / beneficial owners of the equity shares of the company, as on record date, which will be decided subsequently, on a proportionate basis, through the "Tender offer" route, at a price of Rs 725 per Equity Share, payable in cash, for an aggregate amount not exceeding Rs 325 crore

-Overweight call, target Rs 1,000 per share
-Per the initial update, AUM Growth was 6 percent QoQ versus 5 percent QoQ in Q2FY24
-Term deposit growth remains healthy (7 percent QoQ versus 11 percent QoQ)
-Average cost of funds increased (20 bps QoQ)
-Progress of merger is on track

Sensex Today | BSE Smallcap index up 0.6 percent led by Mirza International, Alok Industries, Sula Vineyards:

Foreign investor Dendana Investments Mauritius has picked 5,09,500 equity shares, which is equivalent to 0.53% of paid-up equity, via open market transactions, at an average price of Rs 1,269.57 per share. These shares were valued at Rs 64.68 crore.

Foreign company Seabright II sold 5.8 lakh shares, which is equivalent to 0.56% of paid-up equity capital of Tracxn Technologies at an average price of Rs 114.44 per share. Seabright held 4.16% stake as of September 2023.

Torrent Pharmaceuticals has incorporated a subsidiary Farmacéutica Torrent Colombia SAS in Colombia, for 429 crore Colombian Pesos.

Power Grid Corporation of India has been declared as successful bidder under Tariff Based Competitive Bidding to establish Inter-State Transmission System for “Transmission Scheme for Solar Energy Zone in Bidar (2500 MW), Karnataka” on Build, Own, Operate and Transfer (BOOT) basis.

The scope of the project comprises establishment of new 765/400/220 kV substation at Bidar, 765kV D/C Transmission Line and associated bays extension works at other existing substation in the states of Karnataka & Telangana.

Alembic Pharmaceuticals is still in process of restoration of the manufacturing facilities at Namthang, South Sikkim and may soon resume operations in a gradual /
phased manner and anticipate to operate at regular capacities within two months.

Pabrai Investment Funds offloaded 2.03% stake in Sunteck Realty via open market transactions on January 2. With this, their stake in the company reduced to 6.58%, from 8.61% earlier.

The management of UFO Moviez India has approved the termination of its joint venture agreements, dated July 6, 2023, executed with Qube Cinema Technologies. They entered into JV agreements for selling advertisement inventory and mastering of digital content. However, they have been unable to reach a consensus on certain matters including, in particular, the management structure of the joint venture companies. As a result of this, they were not able to operationalise the joint ventures and hence have mutually agreed to terminate the JV agreements.

Sensex Today | Market at 1 PM

The Sensex was up 30.07 points or 0.04 percent at 71,877.64, and the Nifty was up 22.10 points or 0.10 percent at 21,680.70. About 1943 shares advanced, 1316 shares declined, and 60 shares unchanged.

Stock Market LIVE Updates | Morgan Stanley View On Gas Sector 

-India's gas equities offer some of the best growth opportunities 
-Best growth chances as global gas markets go into oversupply in the H2 of the decade
-Gas producers and city gas players benefit alike from volume growth 
-Gas producers and city gas players benefit as the country's gas pipeline network doubles
-Key picks: GAIL, Gujarat Gas, OIL and ONGC

Jupiter Wagons has received a contract worth Rs 473 crore from the Ministry of Defence for the manufacturing and supply of 697 Boggie open military (BOM) wagons.

ESAF Small Finance Bank has recorded total deposits at Rs 18,860 crore for the quarter ended December FY24, a 40.62% YoY and 8.3% QoQ growth, while CASA deposits increased 20.34% YoY and 13.33% QoQ to Rs 3,562 crore. Gross advances for the quarter at Rs 17,156 crore grew by 36.77% YoY and 13.44% QoQ. Asset quality weakened with the gross non-performing assets (NPA) rising 152 bps QoQ to 4.16% and net NPA increasing 99 bps QoQ to 2.2% for Q3FY24.

-Overweight call, target Rs 604 per share
-Weak Q3 with continues lag in the rural sector
-Sequential improvement in demand trends continued during Q3
-Rural continues to lag urban growth for sixth consecutive quarter
-Growth to largely be volume led
-Management expects consumption in both urban and rural markets to recover

Oil prices edged higher on Friday after minutes from a Federal Reserve meeting suggested inflation was under control and as U.S. Secretary of State Antony Blinken prepared to visit the Middle East to try and prevent the Israel-Gaza conflict from widening.

Brent crude futures were up 31 cents, or 0.4%, to $77.90 a barrel, while U.S. West Texas Intermediate crude futures rose 43 cents, or 0.6%, to $72.62 at 0557 GMT.

The dollar was steady on Friday, heading for its strongest weekly performance since July on scaled back expectations of steep and early interest rate cuts this year ahead of closely watched U.S. payrolls data later in the day.

The U.S. currency's strong start has cast a shadow on the Japanese yen, with the Asian currency down 2.5% against the dollar in the first week of the year, its weakest weekly performance since August 2022.

The dollar's rebound will be tested by the nonfarm payrolls report due later in the session. Economists polled by Reuters forecast that 170,000 jobs were created in December, fewer than the 199,000 in November.

Coforge's board members appointed Saurabh Goel as the Chief Financial Officer (CFO) of the company with effect from January 5. Ajay Kalra has relinquished the position of CFO of the company due to personal reasons and to pursue other opportunities. Kalra will continue to be a full-time employee and a senior advisor to the company till July 10, 2024.

Power Finance Corporation has raised its market borrowing programme to Rs 1.05 lakh crore from Rs 80,000 crore, for the current financial year 2023-24.

Power Finance Corporation was quoting at Rs 404.45, down Rs 1.10, or 0.27 percent on the BSE.

Sensex Today | BSE Auto index up 0.6 percent led by Tube Investments of India, Apollo Tyres, Balkrishna Industries:

Syrma SGS Technology has incorporated a wholly owned subsidiary - Syrma Mobility. The new company will do the business of designers, manufacturers, and assemblers in memory chips, memory modules, PCB assemblies and other storage products.

Kal Radio has approved the proposed Scheme of Amalgamation of Udaya FM with Kal Radio. The scheme is subject to necessary statutory and regulatory approvals, including sanction by the National Company Law Tribunal. The amalgamated company will be Kal Radio, the subsidiary of Sun TV Network. The appointed date for the proposed amalgamation has been fixed as April 1, 2023.

Waaree Renewable Technologies' Board of Directors will be meeting on January 20 to consider the proposal for sub-division of the equity shares of the company.

Gold was headed on Friday for its first weekly drop in four, as reduced bets for an early interest rate cut in the U.S. boosted the dollar and bond yields, while investors awaited a key employment report.

Spot gold was up 0.1% at $2,044.57 per ounce, as of 0601 GMT. It has declined about 0.9% so far in the week.

U.S. gold futures rose 0.1% to $2,051.40.

Renowned American stockbroker, financial commentator, and predictor of the 2008 financial crisis, Peter Schiff, has sounded the alarm on the alarming trajectory of the US National Debt. With his recent tweets on January 3, 2024, Schiff expresses deep concerns about the rapid escalation of the nation's debt and forewarns of potential crises on the horizon. READ MORE

Services sector activity continued to expand in December 2023, with the HSBC India services Purchasing Managers' Index (PMI) hitting a three-month high of 59.0, data released on January 5 showed. At 59.0, the gauge of services sector activity was up from November's one-year low of 56.9 and above the key level of 50 that separates expansion in activity from contraction for the 29th month in a row. READ MORE

NTPC has received orders from the GST authorities for collection of GST, Interest and penalty for Delhi, UP, AP, Bihar, Chattisgarh, Maharastra and Gujarat states.

The corporation shall file an appeal before the 1st appellate authority of the applicable jurisdiction against the said orders within the prescribed timelines.

There is no material impact on the financials, operations or other activities of the Corporation due to the above mentioned orders, company said.

Suzlon Group announced a new order win for the development of a 225 MW wind power project for Everrenew Energy Private Limited. Suzlon will install 75 wind turbine generators (WTGs) with a Hybrid Lattice Tubular (HLT) tower and a rated capacity of 3 MW each at the client’s sites at Vengaimandalam, Trichy district and Ottapidaram, Tuticorin district in Tamil Nadu.

This order is for the company's largerrated 3 MW, S144-140m turbines from the 3 – 3.15 MW product series. As part of the agreement, Suzlon will supply the wind turbines (equipment supply) and supervise the project, including commissioning. Suzlon will also undertake comprehensive operations and maintenance services post-commissioning.

Sensex Today | Market at 11 AM

The Sensex was up 85.22 points or 0.12 percent at 71,932.79, and the Nifty was up 28.90 points or 0.13 percent at 21,687.50. About 1885 shares advanced, 1291 shares declined, and 85 shares unchanged.

Even though a low VIX is usually accompanied by stability or a rising index, it is usually a worrying sign, as it suggests that traders are less prepared for unforeseen events. In fact through June 2023 until late December, 13 kept a lid on VIX, with sizable falls on the index failing to attract any panic, but instead finding buying interest to catapult prices to the new peaks that we are at now. We see the rise in VIX since late December as a positive as it prepares the traders for future shocks.

Also, VIX is still not at a level that signals panic yet, but just high enough to sensitise the traders and improve the volatility expectations. That the recent fall did not call for a VIX beyond 17, the level seen during Jan-Mar when panic was the highest last year is suggestive that VIX could still ease off or even blow hot and cold for a while. This is in fact more dangerous to weekly traders than stock traders, as we may alternate between cheap straddles to expensive ones, week on week.

Zuari Envien Bioenergy ceased to be wholly-owned subsidiary of Zuari Industries with effect from January 4 and will continue as a 50:50 joint venture company of Zuari Industries and Envien International (a part of Malta-based Envien Group). Zuari Envien Bioenergy has allotted 1,84,90,000 partly- paid up equity shares to Envien in addition to existing 10,000 fully paid up equity shares allotted to Envien, while Zuari Industries is holding 10,000 fully paid-up equity shares and 1,84,90,000 partly-paid up equity shares in Zuari Envien Bioenergy.

Shares of Kalyan Jewellers' saw a 2 percent increase at the opening on the NSE following a reported 40 percent revenue growth for their India operations.

In a regulatory filing on January 4, Kalyan Jewellers reported a revenue growth of around 40 percent led by robust operating momentum on the ground with healthy same-store-sales growth across all the key markets in the country. During the quarter, the company has added 22 net new Kalyan showrooms with 16 of those under the Franchisee Owned Franchisee Operated model.

The Middle East business has also continued to witness positive operating momentum with revenue growth for Q3 FY 2024 at around 6 percent compared to previous fiscal. According to the release, the Middle East business contributed around 13 percent to their consolidated revenue for the recently concluded quarter. Read More

Shares of Dabur India were trading 0.5 percent higher at open on the NSE on January 5, a day after the company reported that consolidated revenue is expected to register mid to high single digit growth in Q3FY24. At 9:20 am, the stock was trading at Rs 569.2.

In a regulatory filing on January 4, Dabur India said that the quarter ended December 2023 witnessed sequential improvement in demand trends although rural growth was still lagging urban growth. According to the company, the consolidated revenue is expected to register mid to high single digit growth during Q3 FY24. Read More

KPI Green Energy informed that new order of 3 MW for executing solar power project have been received by M/s. KPIG Energia Private Limited, a wholly owned subsidiary of the company under ‘Captive Power Producer (CPP)’ segment of the company.

Utkarsh Small Finance Bank has recorded a 30.8% on-year growth (up 10.2% QoQ) in gross loan portfolio at Rs 16,408 crore for quarter ended December FY24, while total deposits increased by 17.6% YoY and 8.2% QoQ to Rs 15,111 crore during the quarter. CASA deposits rose by 11.6% YoY and 8.3% QoQ to Rs 3,016 crore, while CASA ratio dropped YoY to 20% from 21% but improved sequentially from 19.9%.

Sensex Today | Nifty Information Technology index gained 1 percent supported by Mphasis, Coforge, Wipro:

-Overweight call, target Rs 770 per share
-Company managed to sell all 1,100 units of arbour 2/Privana South in December 2023
-Company fetched more than Rs 8,000 crore (USD 1bn) after selling all 1,100 units of arbour 2/Privana South
-Company plans to launch another phase in January
-FY24 pre-sales could breach Rs 20,000 crore (guidance of Rs 13,000 crore) & will be up 30 percent YoY

Sensex Today | BSE Power index up 1 percent supported by NHPC, CG POwer, Tata Power:

The retail disbursements for Q3FY24 is estimated at around Rs 14,500 crore, a growth of 25% on a YoY basis, while retail loan book at the end of Q3FY24 is estimated at Rs 74,750 crore, growing 31% YoY. Retailisation of the portfolio is estimated at 91% at the end of Q3FY24.

Gold and silver exhibited notable volatility, indicating vulnerability during the early trading session, influenced by a robust dollar and an increase in U.S. bond yields. The U.S. ADP non-farm employment data surpassed expectations, coupled with a decline in jobless claims last week, contributing to downward pressure on both precious metals. However, a combination of short coverings and opportunistic buying at lower levels provided support to gold and silver in anticipation of the forthcoming U.S. job data.

We anticipate continued volatility in today's session for gold and silver, leading up to the release of the U.S. non-farm employment data. Gold finds support within the range of $2031-2020, with resistance observed at $2058-2069. Meanwhile, silver experiences support at $22.88-22.70, with resistance positioned at $23.28-23.45.

In terms of Indian Rupees (INR), gold is backed by support at Rs 62,450-62,310, facing resistance at Rs 62,790 and Rs 62,990. For silver in INR, support is seen at Rs 71,850-71,380, while resistance lies at Rs 72,950 and Rs 73,580.

Kay Cee Energy & Infra stock made a stellar debut, listing at a 366.66 percent premium over the IPO price on January 5. The stock opened at Rs 252 against the issue price of Rs 54 on the NSE SME platform.

Gross Advances up 32% YoY at & up 5% at Rs 32,777 crore and Total Deposits up 39% YoY & up 5% QoQ at Rs 32,385 crore.

Pre-sales were up 12% YoY & down 4% QoQ at RS 3,410 crore and collections down 3% YoY & 6% QoQ at RS 2,590 crore

Sensex Today | Market at 10 AM

The Sensex was up 241.42 points or 0.34 percent at 72,088.99, and the Nifty was up 77.40 points or 0.36 percent at 21,736. About 2269 shares advanced, 799 shares declined, and 90 shares unchanged.

The recently concluded quarter recorded consolidated revenue growth of over 33% when compared to the same period in the previous financial year.

Company saw revenue growth of ~40% for India operations during Q3 FY2024 as compared to Q3 FY2023, led by robust operating momentum on the ground with healthy same-store-sales growth (similar to levels seen in Q2 FY2024) across all the key markets in the country.

Added 22 net new ‘Kalyan’ showrooms in India during the recently concluded quarter.

Sensex Today | BSE realty index up 2.5 percent led by Phoenix Mills, Macrotech Developers, Brigade Enterprises: