Closing Bell: Nifty below 21,850, Sensex down 736 pts; all sectors in the red

Indian equity indices fell 1 percent on March 19 with Nifty at 21800 amid selling across the sectors.At close, the Sensex was down 736.37 points or 1.01 percent at 72,012.05, and the Nifty was down 238.20 points or 1.08 percent at 21,817.50.

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.

On March 19, Indian equity indices experienced a 1 percent decline, with the Nifty closing at 21,817.50 amid widespread selling across various sectors. At the close of trading, the Sensex was down by 736.37 points or 1.01 percent, settling at 72,012.05, while the Nifty was down by 238.20 points or 1.08 percent.

The Nifty breached its daily trendline, closing below the 21,850 level and forming a bearish candlestick with significant volume, indicating sustained bearish pressure likely pushing towards the 21,600 level, which serves as immediate support. Conversely, the 22,000 level acts as an immediate hurdle for long positions. Additionally, prices are trading below both the 20 and 50 EMA, signaling further bearishness.

Analysis of the Open Interest (OI) data revealed the highest OI on the call side at the 22,000 strike price, followed by the 22,200 strike price. On the put side, the highest OI was observed at the 21,500 strike price.

Following the BoJ's decision to hike interest rates for the first time in 17 years, the Asian peers’ mood turned sour, which pulled the Indian market to continue its recent pessimism. The correction in the domestic market has also been triggered by concerns over premium valuations and the delay of rate cuts by the US Fed due to hotter than expected inflation, which is evident from the upward trend in the dollar index.

Investors are exercising caution as they await the upcoming US Fed meeting, seeking indications on the potential timing of a reversal in the rate cycle. Additionally, the gradual increase in crude oil prices is further dampening market sentiment.

The Nifty has broken down from the rising wedge pattern on the daily chart, suggesting a potential reversal of the uptrend. Additionally, it has fallen below the critical short-term moving average, indicating weakening momentum. The Relative Strength Index (RSI) has also shown a bearish crossover, indicating increasing selling pressure. Key levels to watch include resistance at 22000 and support at 21800. A drop below 21700 could lead to further correction in the Nifty index.

The BankNifty experienced another day of sideways trading, indicating ongoing indecision between bulls and bears, marked by the formation of a doji candle. Key levels to watch include support at 46000 and resistance at 47000, where the highest put and call open interests are concentrated. A breakout beyond this range is awaited for a directional move; however, within the range, the bullish sentiment prevails. Traders may consider adopting a buy-on-dip strategy, with 46000 as a stop-loss level.

The rupee depreciated by 13 paise, closing at Rs 83.04 against the US dollar. This decline is primarily driven by a significant rise in the dollar index, which surged by $0.70 to $103.70. This surge stems from a shift in expectations regarding the US Federal Reserve's interest rate policy.

Markets now anticipate that the Fed will hold off on interest rate cuts in March, potentially delaying them until June or July. This shift in sentiment has strengthened the dollar across the board, leading to a general weakening of other currencies, including the rupee.

Looking ahead, the ongoing two-day policy review by the Fed will be crucial. The tone of the Fed's statements will likely impact the dollar's trajectory. A hawkish stance could further bolster the dollar, potentially pushing it towards $104.50 and weakening the rupee to around 83.20.

-India can take a lot more of issuance
-Fresh issuance crossing $100 billion will bring fresh set of investors
-Fresh issuance crossing 100 billion will bring more investments as it will allow investors, especially FIIs to liquidate positions
-Real estate is one white space that's going to grow. It's going to be the biggest beneficiary

“There's always froth in the market, but markets correct itself. I don't believe we are in bubble territory. There is froth but the market is taking care of that,” says Ramesh Damani, Member, BSE

Commenting on PSU sectors, he says, “PSU sectors are good buys across sectors. Every bull market is all about leadership. This bull market is led by PSU stocks. This sector will continue to lead the rally.

In the early trade itself, TCS-led selling in the IT counters dragged the Index below its immediate support of 21,900. Follow-up selling in other heavyweights mounted pressure on the Index to trade lower and end the session at 21,817.45 with a loss of 238.25 points. All the sectors ended the day in red with IT and Media being the major laggards.

By ending the session lower by 1.24% & 1.19%, Mid and Smallcaps more or less moved in tandem with the Frontline Index.

After violating its immediate support of 21,900, the Index is about to form an advanced harmonic pattern known as Bullish Cypher at 21,740. Post the pattern reversal confirmation, one can expect the target of 22,000 followed by 22,200 respectively.

Indian rupee ended 14 paise lower at 83.04 per dollar versus previous close of 82.90.

Indian equity indices fell 1 percent on March 19 with Nifty at 21800 amid selling across the sectors.

At close, the Sensex was down 736.37 points or 1.01 percent at 72,012.05, and the Nifty was down 238.20 points or 1.08 percent at 21,817.50. About 1202 shares advanced, 2458 shares declined, and 112 shares unchanged.

Biggest lowers on the Nifty included TCS, BPCL, Tata Consumer Products, Tata Consumer and Nestle India, while gainers were Bajaj Finance, Bajaj Auto, Kotak Mahindra Bank, Hindalco Industries and Bharti Airtel.

All the sectoral indices ended in the red with Healthcare, IT, FMCG, Capital Goods, oil & gas, power down 1-2 percent.

BSE Midcap and Smallcap indices shed 1 percent each.

-Overweight call on IndiGo
-DGCA has decided not to extend June 1 deadline for implementing revised FDTL norms
-DGCA has asked airlines to submit the revised schemes by April 15
-New norms aim to mitigate pilot fatigue
-New norms call for increased weekly rest time to 48 hrs for pilots
-New norms call for limit number of landings to two during night operations
-We expect IndiGo to share details on the impact from new norms in the coming analyst day
-For now our initial estimate is that indigo may need an additional 10-15 percent pilots
-With given tight capacity, as some airlines may not be able to get all pilots
-The additional costs will be passed to consumers
-Maintain 6 percent FY25 capacity growth target

Olectra Greentech Limited has received a Letter of Award (LOA) from Assam State Transport Corporation (ASTC / Authority) for supply of 10 electric buses on outright basis.

-Equal-weight call, target Rs 190 per share
-Approval for sale of approximately 5 percent stake in the AMC
-At the floor price Rs 450 per share company should receive a consideration of Rs 650 crore
-This is approximately 55 bps of the NBFC's FY2024 risk-weighted assets
-As of December 2023, promoters held an 86.47 percent stake in AMC, with company having 49.99 percent stake

-Maintain buy, target at Rs 170 per share
-Model 12.5 percent YoY revenue growth for FY25, but company can better this number
-15 percent revenue growth could drive 45 percent EBITDA growth for FY25
-Trading at attractive valuations of 14x/12x FY25/26 EV-EBITDA
-Earnings momentum in place, valuation rerating should follow

The Board of Directors at its meeting held on today has approved fund-raising program of the company for FY 2024-25, which includes issuance of Redeemable Non-Convertible Debentures upto the overall limit of Rs 6000 crores by way of private placement or/and Public issue in one or more tranches as may be decided by the Board of Directors or its committee thereof from time to time.

Sensex Today | BSE Telecom index slipped 1.5 percent dragged by MTNL, GTL Infra, Vindhya Telelink

-Reiterate add call, target raised to Rs 3,075 per share from Rs 2,825 per share
-Well placed to deliver DD volume CAGR & mid-teen EPS CAGR over FY24-27
-Rural is growing at 1.5x urban for company, aided by distribution expansion
-Growth/pioneer categories growing faster than the core portfolio
-Real estate upcycle can accelerate growth of the core adhesives portfolio

The Indian Rupee depreciated by 0.09% on Tuesday on strong US Dollar and weak domestic markets. Firm crude oil prices and FII outflows also weighed on the domestic unit. The US Dollar strengthened on weak Yen after the Bank of Japan raised interest rates for the first time since 2017 ending its negative interest rate regime and scrapping its yield curve control (YCC). Market expectations of a pushback in rate cut by the US Federal Reserve also supported the Dollar.

We expect the Rupee to trade with a negative bias on risk aversion in the global markets amid a strong Dollar and expectations of an unchanged US monetary policy later this week. Firm crude oil prices amid renewed geopolitical tensions between Ukraine and Russia also deteriorated global risk sentiments. However, any selling on Dollars by RBI may support Rupee at lower levels. Traders may take cues from housing starts and building permits from the US. Investors may remain cautious ahead of the US FOMC meeting this week. USDINR spot price is expected to trade in a range of Rs 82.80 to Rs 83.20.

The sell-off in the market comes as investors turn cautious aheaod the US Fed outcome later in the week. The Fed is scheduled to meet on March 19 and 20 to decide on the key policy rate. According to experts, the Fed is expected to hold rates. The last minutes release and the various data points suggest a clear hold case for now.

IT major TCS being the top Sensex laggard with a loss of over 3 percent, dragged the headline index. Other IT counters such as HCL Tech, Wipro and Infosys - also traded with cuts, weighing on the index. Overall, the IT index fell around 2 percent, the worst sectoral loser today.

-Neutral call, target Rs 1,625 per share
-Poonawalla Fincorp announces appointment of company’s Arvind Kapil as new MD & CEO
-Company has depth in senior management, which it has demonstrated in the past as well
-Do not expect any material impact on business owing to this change in senior management
-Any similar churn at senior management over near-to-medium term will be key monitorable

Sensex Today | Nifty Pharma index shed 1.2 percent dragged by Cipla, Dr Reddy's Laboratories, Aurobindo Pharma

-Maintain buy, target raised to Rs 4,200 from Rs 3,700 per share
-See supply for industry growing at or below 12 percent till FY30
-Company may add capacity at a pace similar to or faster than market over this period
-Current demand is not yet fully addressed by today’s supply
-Pricing would likely remain healthy over time & less prone to irrationality
-Increase the multiple to 20x

REC board declared third interim dividend of Rs 4.50 per share and approved sale and transfer of the entire shareholding of three wholly owned subsidiaries, presently held by REC Power Development and Consultancy Limited (RECPDCL), a wholly owned subsidiary of REC to the successful bidders selected through Tariff Based Competitive Bidding process.

Stock Market LIVE Updates | Nomura On Tyre Companies

-Remain cautious on the sector
-Sharp jump in natural rubber prices another headwind to tire sector margins
-Weak demand, rising commodity price could normalise margins faster for the sector
-Natural rubber prices in the domestic market have jumped 23 percent QoQ
-International rubber price increase has been even steeper, up 66 percent QoQ
-Domestic rubber prices usually trade at a 10-15 percent premium to global prices
-There can be further uptick in the domestic rubber prices
-Companies will try to take price hikes to pass on a part of the cost, but will be difficult

Gold prices edged lower on Tuesday due to a stronger dollar, while investors looked forward to the U.S. Federal Reserve policy meeting, which could offer further clues on the timing of interest rate cuts this year.

Spot gold was down 0.2% to $2,156.67 per ounce, as of 0659 GMT. U.S. gold futures eased 0.2% to $2,159.80.

The dollar rose 0.2% to a near two-week high, making gold more expensive for other currency holders.

-Buy call, target at Rs 1,800 per share
-Arvind Kapil resigning, is tad negative given his seniority
-Retention & smooth transition will be key
-Strong talent base is a comfort

Sensex Today | Nifty Midcap 100 near 46,000

-Outperform call, target Rs 6,117 per share
Company’s board has approved a fundraise proposal up to Rs 3,200 crore
Think the fund raise proposal can only be for funding acquisitions
Investors could see this potential equity dilution negatively
Investors could see equity dilution negatively as the dilution implied is up to nearly 8.4 percent
Maintain outperform rating & target price as we see potential dilution as hypothetical situation do not change our PE target multiple of 30x

Jindal Stainlessis partnering with JBM Auto for fabrication of over 500 energy-efficient and light-weight stainless steel electric buses.

Sensex Today | Nifty Media index slipped 1.6 percent dragged by Network 18 Media & Investments, TV18 Broadcast, Dish TV

Bitcoin fell by as much as 5.7% on Tuesday in its largest one-day drop in two weeks, as a wave of selling hit cryptocurrencies and other risk assets, such as stocks.

The price was last down 5.25% at $63,806, having hit a two-week low of $63,555, while ether dropped 5.1% to $3,326.

Bitcoin is still showing a 52% gain for the year so far, as investors have piled into U.S. exchange-traded funds backed by spot bitcoin.

-Outperform call, target Rs 6,117 per share
-Fund Raise only an enabling resolution valid for the next 12 months
-Fund raise proposal can only be for funding acquisitions
-Investors could see this potential equity dilution negatively
-Maintain outperform call as potential eq dilution is a hypothetical situation

Bondada Engineering has received a Letter of Intent for grant of work order from M/s. The Singareni Collieries Company Limited, pertaining to contract of Design, Engineering, Supply, Construction, Erection, Testing & Commissioning of 67.5 MW (AC) (with 220 KV Evacuation voltage) capacity ground based Solar PV Power Plant and 10 years Plant O&M at Mandamarri Area, SCCL with gross order value amounting to Rs. 4,33,91,00,000.

Stock Market LIVE Updates | BSE Realty index shed 0.7 percent dragged by Phoenix Mills, Sobha, Macrotech Developers

One of the two bidders for bankrupt Indian airline Go First has raised its offer following a nudge from lenders, two banking sources and a person aware of the development said on Tuesday.

The consortium, which includes budget carrier SpiceJet's managing director Ajay Singh and Busy Bee Airways, increased the bid amount between 1 billion rupees ($12.06 million) and 1.5 billion rupees, one of the sources said. The original bid amount stood at 16 billion rupees.

The sources did not wish to be identified as they were not authorised to speak to the media.

Stock Market LIVE Updates | BSE Power index shed nearly 2 percent dragged by Siemens, Suzlon Energy, Adani Green Energy

Brahmaputra Infrastructure received a LOA from the office of General Manager ( Tech.) – Ne NHAI, Ministry of Road Transport and Highways , Government of India for the execution of the contract for four lane divided carriageway Road with paved shoulders configuration from km. 5+500 to km. 35.862 of NH-36 and km. 00+000 to 22+000 of NH-54 including 2.107 km Doboka Bypass in the state of Assam on PBMC Mode- Letter of Acceptance (LOA)- of an total amount Rs 50.80 crore.

A meeting of the Board of Directors of PC Jeweller will be held on Friday, March 22, 2024, to consider and approve raising of funds by way of Further Public Offer, Rights Issue, American Depository Receipts / Global Depository Receipts / Foreign Currency Convertible Bonds, Qualified Institutions Placement, Debt Issue, Preferential Issue or a combination thereof or any other method as may be considered appropriate, subject to necessary regulatory, statutory and other approval(s), if any.

-Overweight call, target Rs 3,636 per share
-Have seen a strong pick-up in order inflows in March 2024
-Near-term prospect pipeline remains strong

Sensex Today | BSE Healthcare index down 1 percent dragged by Vimta Labs, Alembic Pharma, SMS Pharma

Poonawalla Fincorp announced the appointment of Mr. Arvind Kapil as Head, Mortgages at HDFC Bank, and a retail banking veteran (with over 25 years of experience with HDFC Bank in handling a bouquet of retail products) as the MD & CEO for 5 years, starting 24-Jun-2024. He will replace current MD & CEO, Mr. Abhay Bhutada, who will move to Poonawalla Group, and remain a non-executive director in the company.

With this leadership transition, broking house expect the company to pivot to a phygital approach (branch + digital) with a wider product offering to target a larger customer base.

With backing of the Poonawalla Group, AAA credit rating, guidance of Mr. Keki Mistry, and a retail banking veteran in Arvind Kapil at the helm of affairs, the right ingredients are in place to establish a successful retail lending franchise.

However, the pivot in business model will likely drive growth and profitability moderation in the near term. Against this backdrop, reiterate reduce on the stock with unchanged Dec-24E Target of Rs 440 (Implied FY26E P/BV: 3.1x), owing to rich valuations.

Sensex Today | Nifty Auto index down 0.6 percent dragged by MRF, Sona BLW, Tata Motors

Dr. Reddy’s Laboratories announced the launch of Versavo (bevacizumab) in the United Kingdom (UK). Versavo is a (bevacizumab) biosimilar of Avastin and indicated for the treatment of several types of cancers, including metastatic colorectal cancer, advanced non-squamous non-small cell lung cancer, recurrent glioblastoma, metastatic renal cell carcinoma, advanced cervical cancer, ovarian cancer and metastatic breast cancer2.

HCLTech and CAST announced plans to scale their partnership to offer customized chips to enable original equipment manufacturers (OEMs) across industries accelerate their digital transformation and automation journeys.

Broking house estimate Kajaria Ceramics revenue/EBITDA/PAT CAGR of 11%/17%/20% over FY24-26.

It estimates ROE/ROCE to improve to 22%/26% by FY26 versus 18%/21% in FY24.

The company has been generating FCF since FY16, which is likely to continue going forward as well. The company turned net cash in FY19 and expect it to remain so going ahead as well (net cash is estimated at Rs 3.8 billion in FY26 versus Rs 1.8 billion in FY23) despite higher capex (Rs 10.2b over FY24-26).

The stock is currently trading at an attractive valuation of 29x FY26E EPS (vs. 37x last five-year average one-year forward P/E).

Reiterate Buy rating on the stock with a Target Price of Rs 1,600 based on 40x FY26E EPS.

Sensex Today | Kotak Institutional Equities View on Cement Sector

Brokerage firm see 3QFY24 operating margins for cement producers as a near-term peak and expect margins to contract in 4QFY24E on sequential basis, an aberration in seasonally strong 4Q, led by unseasonal price cuts only partly offset by cost deflation and operating leverage. 

It trim earnings and Fair Value factoring the recent weakness in cement prices. 

The EBITDA estimates for FY2024-26E are ~5% lower than consensus and expect consensus downgrades. Ramco Cements and Shree Cement are top sells in the coverage.

Sensex Today | Market at 12 PM

The Sensex was down 724.21 points or 1.00 percent at 72,024.21, and the Nifty was down 233.70 points or 1.06 percent at 21,822.00. About 1070 shares advanced, 2169 shares declined, and 91 shares unchanged.

Switzerland-based subsidiary Carbogen AMCIS, a pharmaceutical process development and active pharmaceutical ingredient (API) manufacturing company, announced the successful completion of its first Brazilian Regulatory Authority Agency (ANVISA) routine inspection of its facility in Shanghai. The said inspection was undertaken during November 6-10, 2023 and concluded with no critical and no major observations. Hence, a good manufacturing practice (GMP) certificate has been granted to the site by the authority.

LIC's stock is down from its all-time highs, and trading below the price of its initial public offering (IPO) indicates that there may be short-term volatility. Depending on their tolerance for risk, short-term investors may decide to book a profit or sell, but longer-term investors may see this as a chance to accumulate.

Financial performance, sector dynamics, competitive environment, and management tactics are some of the factors that affect the stock's trajectory. While long-term investors should perform careful due diligence, short-term traders may be able to profit from market fluctuations.

Sensex Today | BSE Smallcap index shed 1 percent dragged by Indiabulls Real Estate, Navkar Corporation, Capri Global

Sensex Today | BSE Midcap index down 1.5 percent dragged by CRISIL, Exide Industries, L&T Technology

L&T Finance Holdings has received approval from the Board of Directors for raising of funds up to Rs 1.01 lakh crore through non-convertible debentures (NCDs) in one or more tranches.

Stock Market LIVE Updates | Morgan Stanley View On Airlines

-DGCA decides to not extend June 1 deadline for revised FDTL norms
-FDTL norms aim to mitigate pilot fatigue
-Expect IndiGo to share details on impact, company may need additional 10-15 percent pilots
-With given tight capacity, as some airlines may not be able to get all pilots
-Maintain 6 percent FY25 capacity growth target
 

Indian Metals' subsidiary company Utkal Coal Limited has received Rs 131,52,57,422 from Nominated Authority, Ministry of Coal as part compensation towards land for Utkal 'C' Coal Block.

We expect Fed to hold rates. The last minutes release and the various data points suggest a clear hold case for now. The last 2 inflation data points have been slightly higher than expected and various statements from the Fed officials suggest that they want to wait longer until they get assurance of direction of inflation towards 2%. It is important to look at the guidance Fed gives during this meeting for the rest of the year. We expect Fed to start cutting rates by 2nd half of the year. However, incoming data on inflation and employment number will be the key to decide how early the rate cycle can reverse.

Stock Market LIVE Updates | All sectors drown in the sea of red; Nifty IT worst sectoral performer

SBI Mutual Fund’s Smallcap Scheme posted the worst Stress Test report with the number of days to liquidate 25 percent of its portfolio at 30 days and 50 percent at 60 days. In comparison, other funds reported a range of 3 to 42 days, and 2 to 21 days respectively. The fund with a corpus of Rs 26,000 crore has been the best performer in its category, posting 27 percent return per annum. In an exclusive conversation with Moneycontrol, chief investment officer, R Srinivasan, seemed unperturbed by the liquidity report and answered questions with candour. READ MORE

Sensex Today | Market at 11 AM

The Sensex was down 573.82 points or 0.79 percent at 72,174.60, and the Nifty was down 190.70 points or 0.86 percent at 21,865.00. About 1121 shares advanced, 2022 shares declined, and 106 shares unchanged.

Lemon Tree Hotels has signed a License Agreement for Lemon Tree Hotels Agartala in Tripura. The hotel is expected to open in FY27. Carnation Hotels, a wholly owned subsidiary and the hotel management arm of the company will be operating this hotel.

Sensex Today | BSE FMCG Index shed 1 percent dragged by Vadilal Industries, Eveready Industries India, Radico Khaitan

JBM Ecolife Mobility Private Limited, a subsidiary of JBM Auto Limited, has been declared as L1 and awarded the Tender as a bus operator for Procurement, Supply, Operation and Maintenance of 1,390 Electric Buses [approx. 65%] and development of allied electric and civil Infrastructure on Gross Cost Contracting [GCC] under the PM-eBus Sewa Scheme.

Oil prices dipped on Tuesday due in part to the prospect of rising supply from Russia, slower-than-expected downstream demand in sectors such as jet fuel, and cautious trading ahead of the Fed's decision on U.S. interest rates.

The Brent crude oil futures contract for May delivery slipped 15 cents to $86.74 a barrel as at 0433 GMT, while U.S. West Texas Intermediate (WTI) prices fell 14 cents to $82.02. The WTI April contract, with expires tomorrow, fell 15 cents to $82.57.

Both benchmarks reached four-month highs in the previous session, buoyed by lower crude exports from Saudi Arabia and Iraq and signs of stronger demand and economic growth in China and the US.

-Confluence of factors, both domestic & global, hurting market
-Tax planning, advance tax payments, SEBI diktat on mid & smallcaps, electoral bonds impacted sentiment
-Crucial to protect your capital for the next 10-15 days
-Don’t think the trend has reversed; still feel we’ll make a new high
-Capital goods & engineering, PSU banks, travel & tourism among preferred picks

Rajat Luthra has resigned as CEO - KFC of Devyani International with effect from March 29. Pradeep Das will be taking over the charge as CEO – KFC from Rajat Luthra. Currently, Pradeep Das is the CEO of airports & institutional business.

Sensex Today | Nifty Bank index down 0.4 percent dragged by IndusInd Bank, PNB, Bank of Baroda