Closing Bell: Nifty at 21,500, Sensex down 671 pts; metal, FMCG, banks top drag

Benchmark indices ended lower on January 8 with Nifty below 21,550. At close, the Sensex was down 670.93 points or 0.93 percent at 71,355.22, and the Nifty was down 197.80 points or 0.91 percent at 21,513.

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

The Bank Nifty bears staged a strong comeback, leading to a breach of the critical support at 47700 on a closing basis. Selling pressure was evident across the banking sector, and a sustained move below 47700 may result in further declines towards the 47000 level. To resume the uptrend, the index must surpass the key resistance at 48300, targeting the 50000 mark.

On January 8th, at the close, the Sensex experienced a decline of 660 points or 0.95 percent, closing at 71,355.22, while the Nifty saw a decrease of 197.8 points or 0.91 percent, ending at 21,513.

In the daily chart, Nifty formed a bearish engulfing candlestick pattern, indicating bearishness in Nifty. If Nifty breaks the 21,500 level, it may further decline to around 21,220 in the short run. Crucial support levels are identified at 21,350–20,200, with resistance at 21,700–21,800. Despite the current dip, the overall trend remains positive, and investors may view it as a buying opportunity near the 21,300-21,200 level.

In BankNifty, on the daily chart, there was a breakdown of the daily trend line, and the price closed at the 47,450 level, forming a bearish marubozu candle with significant volume, indicating bearishness in banking stocks. If the price breaks the 47,400 level, the next support is found near the 47,100-47,000 level. On the flip side, the levels of 48,000-48,200 act as resistance.

Upon reviewing the Open Interest (OI) data, the call side displayed the highest OI at the 48,000 level, closely followed by the 48,500 strike prices. Conversely, on the put side, the highest OI was observed at the 47,000 strike price.

Markets traded under pressure and lost nearly a percent, in continuation to the prevailing consolidation phase. After the flat start, Nifty drifted gradually lower and finally settled around the day’s low at 21,513 levels. The decline was widespread wherein FMCG, metal and banking were among the top losers. The broader indices also felt the heat and lost in the range of 0.6%-1.06%.

Nifty has engulfed the gains of the last three sessions and may slip further towards the support zone of 21200-21300 levels. The move shows that participants are in the profit taking mood citing a dip in the US markets and caution ahead of the earnings. Amid all, traders should keep a check on aggressive longs and accumulate quality stocks on dips.

The Nifty opened gap up however it was unable to sustain at higher levels and witnessed negative price action throughout the day. It closed down ~180 points. On the daily charts we can observe that the Nifty has broadly traded in the range 21500 – 21850 since past couple of weeks. There are multiple support parameters in the form of the key Fibonacci retracement levels (21507 & 21406) and the 20-day moving average (21426) which are likely to provide cushion in case of a correction. We expect Nifty to halt its fall at support levels and consolidate before resuming next leg of upmove.

Bank Nifty also witnessed correction and is in the process of testing the lower end (47000) of the broad range. The daily momentum indicator is approaching the equilibrium line indicating that the fall may be around maturity. Overall, we believe that the fall is unlikely to result into a trend reversal and hence this fall should be used as a buying opportunity.

Bears struck back with a bearish engulfing candle. After a steady opening, bulls were seen loosening their grip and the Index started to correct. Post the rangebound mid-session, another round of selling (especially in the banking counters) dragged the Index further lower to end the day at 21,513 with a loss of 197.80 points.

Among the sectors, only Media and Realty managed to end the trade in green while PSU Banks and FMCG were the major laggards. Bearish engulfing around record levels indicates a high probability of a trend reversal where the Index is likely to retest its strong support zone of 21,370-21,400 while the higher side will be capped at 21,650.

BankNifty is likely to dent the market sentiments as it has given a breakdown from a Head and Shoulder formation (hourly chart). The immediate support is 46,930 while 47,900 will act as a resistance.

The market witnessed widespread selling as the euphoria over early rate cuts may diminish due to the better-than-expected non-farm payroll data from the US and the consequent rise in the US 10-year yield.

In the near term, investors’ trade positions will be more inclined towards the upcoming result season. While the outset may be tempered by lower expectations in the IT sector, the overall forecast for earnings growth remains optimistic, projecting double-digit figures.

Indian rupee ended flat at 83.13 per dollar on Monday against Friday's close of 83.16.

: Benchmark indices ended lower on January 8 with Nifty around 21,500.

At close, the Sensex was down 670.93 points or 0.93 percent at 71,355.22, and the Nifty was down 197.80 points or 0.91 percent at 21,513. About 1733 shares advanced, 1723 shares declined, and 75 shares unchanged.

UPL, SBI, SBI Life Insurance, Divis Labs and Britannia Industries were among top losers on the Nifty, while gainers were Adani Ports, HCL Technologies, ONGC, Hero MotoCorp and NTPC.

Among sectors, FMCG, Bank, Pharma, and Metal down 1 percent each.

BSE Midcap index shed 0.8 percent and smallcap index down 0.3 percent.

Indian Rupee appreciated by 0.04% on weak US Dollar and a decline in crude oil prices. Upbeat macroeconomic data from India also supported Rupee. India’s GDP is estimated to grown by 7.3% in FY2023-24 compared to 7.2% in FY2022-23. US Dollar declined late on Friday on a mixed bag of economic data. Though the Non-Farm Payrolls rose more than forecast, US ISM Services PMI declined unexpectedly.

We expect Rupee to trade with a slight negative bias on risk aversion in global markets and expectations that US Dollar may recovery on safe haven demand amid ongoing geopolitical tensions in the Red Sea region. However, decline in crude oil prices and FII inflows this month may support Rupee at lower levels. Investors may remain cautious ahead of inflation data from India and US later this week. USDINR spot price is expected to trade in a range of Rs 82.80 to Rs 83.50.

-Outperform call, target Rs 610 per share
-India volume recovery in Q3 is weak, international growth moderates from Q2 levels
-Expect 1% sales decline and 10% EBITDA growth in Q3
-Sequential improvement in core portfolio volume growth trajectory was encouraging

-Buy call, target Rs 440 per share
-Strong revenue growth and store expansion momentum continues
-India operations recorded approximately 40% YoY growth in revenue
-Management expects to add 15 ‘Kalyan’ stores in India, 2 ‘Kalyan’ Stores in Middle East and 13 ‘Candere’ Stores during Q4FY24

Sensex Today | BSE Information Technology index shed 0.7 percent dragged by eMudhra, Moschip Technologies, 63 Moons Technologies:

-Equal-weight call, target Rs 3,190 per share
-Strong jewellery demand trends with 20%+ growth for fourth quarter in a row
-Company's strategy of regular gold exchange programs is working out favourably
-Weak product mix, exchange programs & consumer offers & wedding share key diff YoY

The Sensex was down 586.95 points or 0.81 percent at 71,439.20, and the Nifty was down 183.80 points or 0.85 percent at 21,527. About 1636 shares advanced, 1824 shares declined, and 63 shares unchanged.

-Equal-weight call, target Rs 553 per share
-Q3 was a weak quarter with rural lag continuing
-Constraints on profitability in general trade channel remained overhang for FMCG overall
-Low raw material cost trends supported gross margin improvement
-Management expects gradual recovery in 2024

The Reserve Bank of India (RBI) has asked Federal Bank to submit a fresh proposal containing at least two fresh names for the position of Managing Director and Chief Executive Officer of the bank.

-Neutral call, target Rs 3,650 per share
-Good growth momentum; watch out for margin trajectory
Jewellery segment growth in Q3 led by double-digit YoY growth in buyers, average selling price and relatively higher growth in gold (plain) & coins
Company made suitable investments in exchange programs & consumer offers
Store expansion remained strong & growth for other segments was impressive as well

Sensex Today | BSE Midcap index down 0.3 percent dragged by Godrej Industries, GMR Airports, Gillette India:

-Buy call, target raised to Rs 4,400 from Rs 3,600 per share
-Improving core earnings & returns, new orders to remain robust
-Core cash flow & ROCE critical for consistent growth
-Supportive environment; consistent upgrade in order/revenue forecast
-Investor concern about increasing exposure to the middle-east unwarranted
-Believe company’s strong order cycle & robust execution should lift margin
-At 1.0x PEG, believe L&T is attractive, raise core PE from 26x to 30x

Power Mech Projects has received order worth Rs 825 crore including civil and mechanical construction works for 2x800 MW (Phase-II) Mahan Ultra Supercritical Thermal Power Project, Village:Bandhua, District Singrauli, Madhya Pradesh from Mahan Energen Limited for Rs 825 crore.

Sensex Today | Market at 2 PM

The Sensex was down 431.79 points or 0.60 percent at 71,594.36, and the Nifty was down 126.40 points or 0.58 percent at 21,584.40. About 1729 shares advanced, 1692 shares declined, and 85 shares unchanged. 

Shares of Bajaj Auto Limited traded higher on January 8 as the company's board of directors are set to meet and consider a share buyback proposal.

In an exchange filing last week, Bajaj Auto stated: "The meeting of the Board of Directors of the company is scheduled on January 8 to consider and approve a proposal to buyback of fully paid-up equity shares of the company and other matters necessary and incidental thereto."

Sensex Today | BSE Bank index down 0.7 percent led by Bank of Baroda, SBI, Federal Bank:

Shreyas Shipping Logistics has reported fire in the engine room of one of its vessel M V SSL Brahmaputra. All crew on board of the vessel are reported safe and there has been no pollution.

-Sell call, target Rs 936 per share
-Company reported flat sales growth in Q3 at a consolidated level
-Organic sales growth saw a low single-digit decline at a consolidated level
-Organic sales growth saw a decline largely due to currency impact from overseas business
-Domestic volumes were in-line with expectations

Solar Industries India have received export orders worth Rs 994 crores for supply of products for defence based application, to be delivered over a period of three years.

-Overweight call, target Rs 1,072 per share
-Organic volume growth & constant-currency sales growth trends were similar to Q2 levels
-Currency devaluation in Africa and LATAM affects reported rupee growth
-EBITDA margins (including forex) to expand YoY, despite higher A&P spends

-Buy call, target Rs 400 per share
-Kalyan’s consolidated sales rose 33% YoY in Q3
-Kalyan’s consolidated sales growth driven by strong domestic sales, beating estimate
-Opened 22 net new Kalyan Showrooms in Q3
-Total India showroom count at 194, company set to open 15 more in Q4, and 80 in FY25
-Asset-light network expansion has started to deliver consistent results

The fire incident has occurred at a job worker’s factory at Amroha, in Uttar Pradesh. The job worker was appointed by Guiltfree Industries, the wholly owned subsidiary of RPSG Ventures, for manufacture of certain of its products. Guiltfree Industries and RPSG Ventures are in the process of ascertaining the cause of the fire and the quantum of actual damage caused by it.

-Buy call, target Rs 2,110 per share
-Net advances up 3.8% QoQ, retail deposits accretion at Rs 53,000 crore
-NIMs & GNPAs have been reset for Q2
-Domestic retail loans grew 3.0% QoQ, CRB loans grew by 6.5% QoQ
-Whereas corporate & other wholesale loans grew 2.0% QoQ
-LDR expanded >200 bps, CASA broadly stable at 37.7% QoQ

Adani Green Energy Limited (AGEL) today announced the redemption plan for the USD 750 million 4.375 notes due 09 September 2024 (Holdco Notes).

The outstanding amounts of the Holdco Notes shall be fully secured through cash balances set aside as part of various reserve accounts securing the Holdco Notes, eight months prior to the maturity.

Godrej Industries has signed a non-binding Memorandum of Understanding (MoU) with the Government of Gujarat. As part of the MoU, the company may plan to invest Rs 600 crore over the next four-year on the significant expansion in Valia with employment of around 250.

Sensex Today | Market at 1 PM

The Sensex was down 434.82 points or 0.60 percent at 71,591.33, and the Nifty was down 132.80 points or 0.61 percent at 21,578. About 1686 shares advanced, 1728 shares declined, and 76 shares unchanged.

Chambal Fertilisers and Chemicals board approved buyback of fully paid-up equity shares of face value of Rs 10 each, not exceeding 1,55,55,555 equity shares (representing 3.74% of the total paid-up equity share capital of the company as on March 31, 2023) at a price of Rs 450 per equity share, payable in cash for an aggregate amount not exceeding Rs 700 crore.

During the quarter ended December FY24, the Adani Wilmar has recorded overall volume growth of 6%, however, lower pricing of edible oils in line with the fall in the cost of raw materials (crude edible oils), resulted in a revenue decline of 15% YoY. Edible oils segment volume stayed flat YoY in Q3 due to subdued demand from institutional clients. But business declined 21% YoY, while food & FMCG business grew by 28% YoY and its volumes jumped 18% during the quarter YoY. Industry essentials segment business was flat YoY, but volumes increased 15% YoY.

Sensex Today | BSE Power index up 0.2 percent led by Suzlon Energy, CG Power, Adani Green Energy:

The Odisha Government has given the possession of total forest land (2,677.80 acres) to JSW Steel's subsidiary JSW Utkal Steel for setting up of a greenfield integrated steel plant of 13.2 million tonnes per annum (MTPA) crude steel. The non-forest land of 272.51 acres has already been leased in favour of JSW Utkal Steel by the government.

Oil India has received approval from the Board of Directors for incorporation of a wholly owned subsidiary company for green energy business. This is subject to approval of Ministry of Petroleum & Natural Gas (MoP&NG), NITI Aayog, and DIPAM (Department of Investment and Public Asset Management).

Aurionpro Solutions said the board of Directors will be meeting on January 10 to consider the raising of funds through issuance of eligible securities via private offerings including, preferential allotment and/or qualified institutions placement.

Sensex Today | Nifty Bank index down 0.7 percent dragged by Bandhan Bank, Bank of Baroda, Federal Bank:

MedPlus Health Services' subsidiary has received orders from drug sales licensing authority, Drug Control Administration. It received order for suspension of drug license for 6 days for store at Shankarayapally Jadcherla, and for 7 days for store at Hayath Nagar. The subsidiary received both orders on January 4.

-Buy call, target raised to Rs 4,200 per share
-Q3FY24 jewellery sales grew strongly at 23% YoY (21% 4-yr CAGR), ahead of estimate
-Other divisions did well too (up 21-24% YoY) except Eyecare (down 3% YoY)
-Company opened 18 new Tanishq stores in India in Q3
-Strong & consistent results reinforce Titan’s structural attractiveness

-Net equity inflow at Rs 16,997 crore versus Rs 15,514.5 crore inflows, MoM
-Liquid fund outflow at Rs 39,675 crore versus Rs 644.7 crore outflows, MoM
-ETF inflow at Rs 200 crore versus Rs 833.62 crore inflows, MoM
-Total assets under management (AUM) at Rs 50.78 lakh crore versus Rs 49.04 lakh crore, MoM

360 ONE Prime, a 100% subsidiary of 360 ONE WAM, to raise up to Rs 1000 crore via public issue of secured, rated, listed, redeemable NCDs.

Tranche 1 opens on January 11 and closes on January 24.

with base issue of Rs 200 crore and green shoe options of Rs 800 crore and coupon rate at 9.66%.

Shares of Satin Creditcare and Karnataka Bank traded lower early on January 8 after the companies entered into a co-lending arrangement.

On January 5, Karnataka Bank and Satin Creditcare Network entered into a co-lending arrangement to provide financial support to Joint Liability Groups (JLG) of economically active women in both rural and semi-urban areas and to give impetus to the micro credit facilities segment of the country.

To improve the flow of credit to unserved and underserved segments, the arrangement will leverage Karnataka Bank’s low cost of funds and end-to-end digital capabilities of bank and Satin through Yubi platform for co-lending, to help the sourcing, servicing and recovery of small-ticket income generation priority sector loans. Read More

Sensex Today | Nifty Metal index down 1 percent dragged by Vedanta, SAIL, MOIL:

Kalyan Jewellers jumped more than 3 percent on January 8 after brokerages maintained a bullish outlook on the jewellery maker on higher revenue and higher footfalls in the December quarter.

Kalyan Jewellers’ consolidated sales rose 33 percent on-year in Q3, driven by strong domestic sales, the jeweller said in a business update. It improved its operating performance despite headwinds such as extreme volatility in gold prices, a higher number of “shradh” days compared to the previous year and flash floods in some parts of Tamil Nadu, which affected retail sales for almost a week.

Morgan Stanley has an “overweight” call on the stock with a target price of Rs 1,072 a share. Its analysts expect Kalyan Jewellers' EBITDA margins to expand on-year despite higher advertising and promotional (A&P) spends. Read More

Sensex Today | Market at 12 PM

The Sensex was down 481.59 points or 0.67 percent at 71,544.56, and the Nifty was down 152.50 points or 0.70 percent at 21,558.30. About 1596 shares advanced, 1779 shares declined, and 80 shares unchanged. 

Caplin Steriles Limited (Caplin), a Subsidiary Company of Caplin Point Laboratories, has been granted final approval from the United States Food and Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) Ofloxacin Otic Solution 0.3%, a generic therapeutic equivalent version of (RLD), FLOXIN Otic Solution of Daiichi Pharmaceuticals Inc.

Today, the Indian stock indices Sensex and Nifty experienced a decline amid volatility. The market outlook is poised to be significantly shaped by the impending quarterly earnings reports from major IT companies such as TCS and Infosys, in addition to the prevailing global market trends.

Nifty, despite high volatility, consolidated near its recent highs and concluded the week with minimal changes. Anticipated support for the Nifty50 index is expected to materialize within the range of 21,600 to 21,650, with a robust buy zone projected at 21,500-21,550.

In the context of Bank Nifty, there is a notable inclination towards Call writing in options, particularly with the 48500 Call strike holding the highest open interest. Simultaneously, significant open interest in At-The-Money (ATM) Put strikes indicates an anticipation of limited downside. The immediate support for Bank Nifty is expected to be around the 47500 levels.

Gold prices fell on Monday as fading expectations of an early rate cut in the U.S. kept the dollar and bond yields supported, ahead of a key inflation print due later this week.

Spot gold was down 0.4% to $2,037.39 per ounce, as of 0342 GMT. U.S. gold futures fell 0.3% to $2,043.60 per ounce.

Trading was thin in Asia, with the Japanese market closed for a holiday.

For every Rs 1 spent on marketing, MobiKwik realised a revenue of Rs 6.64 as of FY23. Other players like Fino payments bank, Groww, Phonepe and Paytm are ahead in this metric. READ MORE

Analysts raised fair value for IRB Infra stock due to due to new TOT project wins, increased estimates and roll-forward

Veteran investor Madhusudan Kela, Europe's Societe Generale and Reliance Commercial Finance are among the many allottees in Shyam Metalics' Rs 1,400-crore QIP. As per the company's filing, the allottees were issued shares at Rs 576, which is a 12 percent discount to last closing price and 3.62 percent discount to floor price of Rs 597.63.

In terms of the Scheme of Amalgamation, the Board has approved Friday, January 19, 2024, as the record date for the purpose of determining the shareholders of Tinplate Company of India who shall be entitled to receive fully paid-up ordinary equity shares of Tata Steel in the share exchange ratio as per the Scheme of Amalgamation.

The Sensex was down 219.09 points or 0.30 percent at 71,807.06, and the Nifty was down 71.00 points or 0.33 percent at 21,639.80. About 1684 shares advanced, 1632 shares declined, and 90 shares unchanged.

Shares of FMCG giant Adani Wilmar Limited dipped 2 percent to Rs 370 in morning trade on December 8 after the company announced that its standalone sales experienced a 15 percent year-on-year decline.

Despite facing challenges, the company experienced overall growth, primarily attributed to the increasing presence of packaged oils and foods. The festive and wedding season played a crucial role in achieving record volumes in branded oil and foods, demonstrating growth compared to a robust base quarter. Read More

Life Insurance Corporation of India has received demand order for GST (Rs 191.01 crore), interest and penalty (Rs 191.01 crore) for Gujarat, for the year FY2017-18 and FY2018-19. The Corporation will file an appeal before Commissioner (Appeals), Ahmedabad against the said order within the prescribed timelines.

Godrej Industries share price touched a 52-week high of Rs 894.85 in the early trade on January 8, the second such gain recently, after the company signed a non-binding memorandum of understanding (MoU) with the Gujarat government.

As part of the MoU, the company may invest Rs 600 crore over the next four years to expand operations in Valia. Godrej Industries already has a manufacturing facility at Valia in the Bharuch district, which produces a wide range of oleo chemical products derived from organic material. Read More

The year-end rally which took the Nifty up by around 14 % from the 2023 October lows, is slowly running out of steam. The major challenge for the rally comes from the mother market US which is showing signs of weakness. The concern in the US now is that the market expectation of a rate cut in March may not materialise since the labour market continues to be tight and the unemployment data is lower than expected. Inflation coming under control means that the rate hiking cycle is over and the Fed pivot is imminent. But the market will be disappointed if the rate cut doesn’t happen in March. The sign of this possible trend can be seen in the firming up of the 10-year US bond yield above 4%.

The exuberance of retail investors may be a positive factor which might push up the already frothy broader market. But profit booking by DIIs and seasonally weak January can impact the rally.

Long-term investors can use dips in the market to buy high quality banking stocks which are fairly priced.

Narayana Hrudayalaya's subsidiary Narayana Health Insurance has been granted license by the Insurance Regulatory and Development Authority of India (IRDAI) to exclusively carry on health insurance business. This will enable Narayana Hrudayalaya to offer an integrated healthcare solution to the general public as a healthcare service provider.

Bhansali Engineering Polymers has issued Letter of Award (LOA) to Toyo Engineering India for front end engineering design (FEED) and capex cost estimation for brown field ABS expansion project. With the expansion, overall, ABS production capacity will increase from 75,000 TPA (tonnes per annum) to 1,45,000 TPA at company's existing plants at Abu Road (Rajasthan) and Satnoor (Madhya Pradesh).