Closing Bell: Sensex falls 528 pts, Nifty below 23,550; metal, PSU banks drag, FMCG shines

Indian benchmark indices ended lower on January 9 with Nifty below 23,550. At close, the Sensex was down 528.28 points or 0.68 percent at 77,620.21, and the Nifty was down 162.45 points or 0.69 percent at 23,526.50.

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.

Markets extended their corrective phase, remaining under pressure and losing over half a percent. After a flat opening, Nifty steadily declined throughout the session, ending near the day’s low at 23,526.50. Most sectors moved in tandem with the benchmark, with realty, energy, and IT emerging as the top losers. Broader indices also came under pressure, slipping nearly a percent each.

Market sentiment is expected to react to TCS's earnings announcement in early Friday trades, which could set the initial tone. The overall outlook remains tilted towards a bearish trend, and traders are advised to utilize any intermediate rebounds as opportunities to short the index. During the earnings season, stock-specific movements will be influenced by result expectations. Participants should align their strategies accordingly, prioritizing relatively strong sectors or themes for long trades and targeting underperforming segments for short positions.

The Nifty index closed slightly above its critical support at 23,500 on Thursday, forming a bearish candlestick below the 200-day EMA, signaling caution. A follow-up breach below 23,500 would validate a sell-on-rise strategy, with further downside expected. Conversely, holding this support may lead to consolidation.

For the short term, 23500 acts as a key support, while resistance is placed at 23800, capping any upside. Traders should monitor these levels closely, as they will dictate the index's immediate directional trend.

The Indian stock market mirrored the decline across its Asian peers, with cautious investor sentiment driven by a sell-off in US bonds. The US 10-year Treasury yield surged to its highest level since April 2024, signalling expectation of fewer rate cuts by the Fed. Further, disappointing inflation data from China added pressure, indicating that recent stimulus measures have failed to rejuvenate one of the world's largest consumer markets.

Domestically, the FMCG sector outperformed, while other sectors declined, anticipating only modest improvement in Q3 earnings estimates, cautioning against high expectations.

The market had a difficult session, with the Index extending its losses and approaching the lows from the previous session. It ended the day in negative territory at 23,526.50 with a loss of 162.45 points. With almost all sectors, except FMCG, closing in the red. Realty and Energy sectors were the worst performers.

In terms of broader market performance, Midcaps mirrored the Frontline Index, while Smallcaps lagged.

Looking at the daily chart, the Index is currently at a crucial support level of around 23,500. If this support is broken, it could drag the Index lower to the next level at 23,260, which corresponds to a previous swing low. On the other hand, for the uptrend to resume, the Index would need to break above the 23,800-23,900 range.

Indian rupee ended flat at 85.86 per dollar on Thursday versus previous close of 85.85.

Indian benchmark indices ended lower on January 9 with Nifty below 23,550.

At close, the Sensex was down 528.28 points or 0.68 percent at 77,620.21, and the Nifty was down 162.45 points or 0.69 percent at 23,526.50. About 1175 shares advanced, 2610 shares declined, and 109 shares unchanged.

Shriram Finance, ONGC, Tata Steel, Coal India, BPCL were among the top losers on the Nifty, while gainers included HUL, Britannia Industries, Nestle India, M&M, Bajaj Auto.

Among sectors, except FMCG all other indices ended in the red with capital goods, IT, metal, oil & gas, PSU Bank, power, realty down 1-2 percent.

BSE Midcap and smallcap indices shed 1 percent each.

Indian Rupee a record low on Thursday on weak domestic markets and a positive tone in the US Dollar. Surge in US bond yields and FII outflows also pressurised the Rupee. Economic data was mixed with weekly unemployment claims favouring the greenback while ADP non-farm employment data stood disappointing.

We expect Rupee to trade with a negative bias on weak domestic markets, strong Dollar and rising US treasury yields. Elevated crude oil prices and FII outflows also put downside pressure on the domestic currency. However, any RBI intervention may support Rupee at lower levels. Investors may watch out for non-farm payrolls report. USDINR spot price is expected to trade in a range of Rs 85.75 to Rs 86.10.

#1Share of domestic gas in CNG segment to increase from 37% to 51%

#2 Have also tied-up additional RLNG volumes on term basis at competitive prices with a major supplier

#1 Cyclical challenges are abating in refining, but continue in retail – but find this priced in

#2 As new refining capacity is absorbed, retail profitability improves, re-rating should regain traction

#3 As new energy cash flows kick in, re-rating should regain traction

#4 Company stands at number 4 in preference order

Arm Novelis in a pre-quarterly release, indicated weak Q3 results

Novelis update indicated flat volume YoY & profitability lowest since Q3FY23

Weakness of Novelis was partly expected given the continued correction in scrap spreads

Recent weakness in stock price more than factors-in stress from Novelis

Domestic business, believe, remains robust led by resilient aluminium price environment

Expect profitability improvement from Novelis with volume improvement

Swiggy Instamart to launch a parallel standalone APP

#1 Raise earnings estimates owing to higher contribution from sitagliptin

#2 Estimate sitagliptin market at USD 300-500 mn, at discounted price, opportunity size for company can be large

#3 Currently, factor in a 5% decline in US revenues in FY26 Vs FY25

#4 Company also benefits from appreciating USD as a large part of exports (77% in FY27) are from US

#1 The Retail segment saw a YoY revenue growth of 42 percent

#3 Franchise segment saw YoY revenue growth of 87 percent

#3 e‐Commerce segment grew by around 98 percent YoY

#4 Diamond category saw a revenue growth of 40 percent YoY

Gujarat Pollution Control Board (GPCB) has revoked the closure order issued on November 29, 2023, following the fire incident, for Manufacturing Facility II of Aether Industries. Consequently, the facility is now approved for 100% resumption of operations.

Ambit Capital keeps 'buy' rating on stock, target Rs 736

#1 In terms of region for JLR, only North America & Europe registered growth

#2 Estimate positive FCF of GBP 250 mn in Q3 led by higher volume

#3 Estimate company will move from having net debt of Rs 22,000 crore in Q2 to net cash of Rs 86 by FY27

#4 Stock is currently trading at 4.2x FY27 EV/EBITDA, which believe is attractive

The company will meet on January 13 to consider a proposal for the issuance of fully convertible warrants into one equity share each.

The company has approved the issuance of up to 29 lakh equity shares of face value ₹10 each to FPIs and the public category on a preferential basis.

The company will meet on January 13 to discuss and consider raising funds in one or more tranches through the issue of equity shares or other instruments.

The company will meet on January 15 to discuss the allotment of up to 2,63,157 convertible warrants of Rs 10 each at a price of Rs 152. Additionally, it will consider the allotment of up to 17.1 lakh equity shares of face value Rs 10 each at a price of Rs 152.

The company has received an order from the Commissioner of Customs, JCNH, Nhava Sheva. Following the order, the company will face a differential customs duty of Rs 38 crore along with interest penalties and a redemption fine of up to Rs 43 crore.

#1 JLR’s Q3FY25 wholesales – mix and leverage to offset higher incentives

#2 JLR’s Q3FY25 wholesale volume growth was nearly 2 percent ahead of estimates

#3 Expect JLR to post an EBIT margin of 9.6 percent to meet its FY25 EBIT margin guidance of 8.5 percent

#4 JLR's FY25-26 margin guidance is a key to watch

Puravankara has acquired a 3.63-acre land parcel in Kanakapura Road, Bengaluru with total estimated Gross Development Value of Rs 700+ crore.

The company will meet on February 5 to consider the declaration of its third interim dividend for equity shareholders.

US-based Novelis Inc., a subsidiary of Hindalco, has announced plans to offer USD 500 million in senior unsecured notes due 2030 in a private offering.

Tembo Global Industries announced the successful acquisition of a significant domestic order in the water irrigation sector. The company has secured a contract valued at Rs 407,342,648.31 for the supply of Ductile Iron (DI) pipes for a water irrigation project. This order, which will be executed over the next 12 months.

A meeting of Board of Directors of the company will be held on Tuesday, 14th day of January, 2025 to consider and approve the proposal for raising funds by way of issue of one or more instruments including equity shares, convertible or Non-Convertible securities of any description or warrants, through preferential issue, private placements or any other methods or combination thereof.

The company has incorporated a subsidiary as a 74:26 joint venture between NTPC Green Energy Limited and Rajasthan Rajya Vidyut Utpadan Nigam Limited. The new subsidiary will develop, operate, and maintain renewable energy parks in Rajasthan and work on developing green hydrogen derivatives.

The company has received an open offer from Authum Investment & Infrastructure, along with Mahi Madhusudan Kela, to acquire a 26% stake in the company for over Rs 544 crore.

The management of the company has decided to setup 30 MW of Solar based Power Plant under captive mode with an approx. project cost of Rs 105 crores .

The company has announced the expansion of its current capacity by 50% in the manufacturing of solar glass, a critical component in the production of photovoltaic solar panels. The expansion plans, which were previously on hold, have been resumed.

Pre-Sales of Rs 8.63 billion in Q3FY25 as compared to Rs 6.16 billion in Q3FY24, showing a quarterly growth of 40% YoY basis.

Collections are at Rs 5.42 billion in Q3FY25 as compared to Rs 4.52 billion in Q3FY24 showing a quarterly growth of 20% YoY basis.

Tata Consultancy Services, Tata Elxsi, Indian Renewable Energy Development Agency, GTPL Hathway, Yash Highvoltage, Padam Cotton Yarns, and Vivo Bio Tech will release their quarterly earnings scorecard on January 9.

#1 Sales Area grew by 59 percent YoY to 1,65,116 sq. ft

#2 Sales Value grew up by 7 percent YoY to Rs 270 crore

#3 Collections grew by 10 percent YoY to Rs 167 crore

#4 Ajmera Iris at Bengaluru launched during the quarter has sold 47% of its inventory

The Sensex was down 235.61 points or 0.30 percent at 77,912.88, and the Nifty was down 81.30 points or 0.34 percent at 23,607.65. About 1587 shares advanced, 1487 shares declined, and 117 shares unchanged.