Closing Bell: Nifty around 21,550, Sensex gains amid volatility; banks drag

Benchmark indices ended higher for the second consecutive session on January 9 amid volatility with Nifty around 21,550. At close, the Sensex was up 30.99 points or 0.04 percent at 71,386.21, and the Nifty was up 31.80 points or 0.15 percent at 21,544.80.

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 gyrated sharply in volatile trades as key indices erased most of their early gains to end marginally higher amid selective buying in auto, realty, metals and oil & gas stocks, whereas banking stocks fell the most. A sharp jump in crude oil prices and fresh uptick in US bond yields have made investors jittery, which dampened the sentiment.

The Nifty witnessed an extremely volatile day of trade today. It witnessed positive price action during the first half while a sharp fall during the second half took away all the gains and the Nifty ultimately closed marginally in the green up ~32 points. Amid the volatile price action the Nifty is still within the broad range 21850-21500. On the way down multiple support parameters in the form of the 20 day moving average ( 21453) and 21406 (50% fibonacci retracement level) shall provide cushion in case of a deeper correction.

Bank Nifty witnessed a sharp decline and has also breached the previous day low (47387) which is a sign of weakness. However the Bank Nifty is approaching crucial support placed in the range (47000 – 46900) and until this range is decisively breached on the downside the structure is still in favor of the Bulls.

Markets witnessed a roller coaster ride on Tuesday and ended almost flat, in continuation to prevailing consolidation phase. Firm global cues triggered a gag-up start in Nifty, which further strengthened with renewed buying in select heavyweights however a sharp cut in latter half trimmed the gains. Eventually, it settled at 21544.85; up by 0.15%. Among the key sectoral indices, realty, auto and pharma posted decent gains while media, banking and financials ended lower. Meanwhile, the boarder indices also traded volatile and closed with modest gains.

The rebound attempt in Nifty shows that bulls are not in mood to loosen their grip easily and supportive global cues could prompt next leg of up move. Meanwhile, participants should limit trades and prefer hedged bets.

The Bank Nifty index witnessed continued dominance by bears as selling pressure intensified from higher levels. The index is currently facing a strong hurdle at the 48000 mark, where a significant buildup in open interest is observed on the call side. The immediate support for the index is positioned at the 47000-46900 levels. A breach below this support zone is likely to trigger aggressive selling pressure, potentially leading to further downside momentum.

Positive sentiments in the Indian IT sector fuelled by a US tech rally and demand on emerging technologies, overshadowed the anticipated muted Q3 results of the sector. Auto & realty continued to remain favourites on account of strong demand. Market optimism about potential softening of US inflation is driving expectations of near-term rate cuts, bolstering overall sentiment. But in-between profit booking is emerging due to mixed cues from Asian markets as well high valuation concerns.

Indian equities moved in tandem with their strong global counterparts and started the session higher at 21,650. As the day progressed, the Index was seen compounding its gains but towards the end, a steep decline in the banking stocks dragged the Index lower to settle the day at 21,544.85 with gains of 31.85 points.

With gains of 2.52%, the Realty sector was the top gainer followed by Pharma and Auto; and on the flip side, Media was the major laggard. BankNifty and PSU Banking sector also ended the day in red. Looking at the larger picture, the Index is oscillating in a range of 21,500-21,800, breakout in either direction will provide clarity.

Indian rupee ended flat at 83.11 per dollar against previous close of 83.13.

: Benchmark indices ended higher for the second consecutive session on January 9 amid volatility with Nifty around 21,550.

At close, the Sensex was up 30.99 points or 0.04 percent at 71,386.21, and the Nifty was up 31.80 points or 0.15 percent at 21,544.80. About 1984 shares advanced, 1330 shares declined, and 71 shares unchanged.

Hero MotoCorp, Adani Ports, SBI Life Insurance, Apollo Hospitals and Adani Enterprises are among the top gainers on the Nifty, while losers were Nestle India, Britannia Industries, Asian Paints, Bajaj Finserv and HDFC Bank.

Among sectors, except bank and FMCG, all other indices ended in the green with auto, healthcare, capital goods, metal, power and realty up 0.5-2.5 percent each.

BSE Midcap index ended flat, while Smallcap index up 0.3 percent.

During the first nine months of the year FY24, the Group registered Sales of 3163,334 mn (up by 81% yoy) and Collections of 384,788 mn (up by 20% yoy).

During Q3 FY24, the Group has registered Sales of 353,261 mn (up by 111% yoy) and Collections of 331,163 mn (up by 36% yoy).

Stock Market LIVE Updates | Jefferies View On Chemicals  

-Specialty Chem7ical is buffeted by weak demand and elevated chinese exports
-Expect demand recovery in H2FY25 
-PI Industries is top pick with healthy volume growth outlook and reasonable valuation
-Downgrade SRF to underperform as we expect business recovery to lag recent stock rally 
-Downgrade SRF to underperform as risk-reward is unfavourable
-Stay on sidelines in Navin Fluorine as await the onboarding of the new MD

Dr Reddy's Laboratories informed that on December 15, 2023, Dr. Reddy’s Laboratories Inc., wholly owned subsidiary of the company, initiated a limited voluntary recall of one specific batch of Tacrolimus capsules, 1 mg, from the U.S. market as a precautionary measure.

The batch contains distributed quantity of 8,280 bottles of 100 capsules each. The single-batch recall was voluntarily initiated by the Company due to a product complaint for one foreign capsule in a single bottle (one 0.5 mg Tacrolimus capsule found in a bottle of 1 mg Tacrolimus capsules).

Tacrolimus capsules are immunosuppressants. This recall will have negligible impact on patient safety. The company continues to supply the product to the U.S. market.

Stock Market LIVE Updates | Jefferies On Real Estate  

-Low inventories & Mid-cycle affordability should support approximately 20% residential sales growth in 2024
-Offices are bottoming out as SEZ regulation changes lower REIT vacancies 
-Offices are bottoming out as domestic demand rises
-Cut cap-rate assumption by 50 bps, raising mindspace REIT to buy
-Developer stocks doubled in 2023 taking sector to peak multiples 
-Expectations are high and easy scaleup is now behind
-Downgrade prestige to underperform, Sobha to hold

Sensex Today | Nifty Bank index down 0.3 percent dragged by AU Small Finance Bank, IDFC First Bank, HDFC Bank:

Indian Rupee appreciated by 0.05% on positive domestic markets and overnight decline in crude oil prices. FII inflows also supported Rupee. However, a recovery in US Dollar today capped sharp gains. US Dollar declined on Monday ahead of US inflation data. Expectations of a rate cut in March 2024 have also eased. Odds of a rate cut in March 2024 fell to 64% from 89% last week.

We expect Rupee to trade with a slight negative bias on expectations of a recovery in the US Dollar and weak European markets. Asian currencies too lost initial gains which may weigh on rupee. Crude oil prices have recovered from early losses and a trading around a percent higher from yesterday’s close. However, positive sentiments in domestic markets and fresh FII inflows 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.

Stock Market LIVE Updates | HSBC On Financials 

-2024 will likely bring two major trade-offs for banks include growth versus NIM & investments versus RoA 
-NBFCs to benefit as liquidity tightness eases
-Rate cuts commence and overall macro remains favourable 
-Prefer Axis Bank & IndusInd Bank among banks
-Prefer Shriram Finance, L&T Fin Holdings & Chola Investment Finance among NBFCs, all in buy call
-Upgrade LIC Housing Finance to hold

Sensex Today | Market at 3 PM

The Sensex was up 137.06 points or 0.19 percent at 71,492.28, and the Nifty was up 56.30 points or 0.26 percent at 21,569.30. About 1948 shares advanced, 1359 shares declined, and 71 shares unchanged.

A decline in U.S. consumer inflation expectations kept the dollar rally in check on Tuesday as traders reaffirmed their bets for a slew of Federal Reserve rate cuts this year.

In cryptocurrencies, bitcoin held near its strongest level since April 2022 on growing anticipation the Securities and Exchange Commission will imminently approve spot bitcoin exchange-traded funds (ETF).

Indian IT companies will likely beat the predictions of continued weakness and see strong earnings growth in 2024 on AI spending boost, Omniscience Capital CEO and Chief Investment Strategist Vikas Gupta has said.

India and US tech companies are expected to have a 15 percent earnings growth during the year, Gupta said in an interview to Moneycontrol.

A majority of analysts expect weakness to continue for the Indian IT sector, which has been hit hard as companies in the US and Europe, their biggest markets, cut spendings.

Accenture, whose bulk of the workforce is based in India, gave a -2 to 2 percent revenue growth guidance for the quarter ending in February. Read More

Sell call, target price at Rs 5,600 apiece
Buyback announced at Rs 10,000/share, promoters expected to participate
Co will buyback 1.41% of total eq shrs on proportionate basis from existing shareholders
Buyback price is pretty steep but promoters are also expected to participate
Promoters’ participation implies the promoter group will potentially receive Rs 2,200 cr
Stock has already seen a run-up 6%
Stock run-up on news of bd meet announcement for buyback of shares on Jan 3

Tata Power Renewable Energy Limited (‘TPREL’), Tata Power subsidiary, has signed two Memoranda of Understanding with the Government of Tamil Nadu to support in the development of the state's renewable energy landscape and accelerate India's clean energy transition.

Indian Bank has received requisite prior approval of RBI for exercise of Call Option on captioned Basel III Tier 2 Bonds Tranche C aggregating to Rs 600 crore.

Oil prices steadied on Tuesday after sliding in the previous session, as markets weighed Middle East tensions against demand worries and rising OPEC supply.

Brent crude futures rose 17 cents, or 0.2%, to $76.29 a barrel, while U.S. West Texas Intermediate crude futures inched up 0.1%, or 5 cents, to $70.82 a barrel.

Gold prices ticked up on Tuesday from a three-week low, helped by a softer dollar after an official U.S. report showing that consumers expected lower inflation boosted hopes for interest rate cuts from the Federal Reserve.

Spot gold was up 0.4% at $2,035.06 per ounce, as of 0737 GMT, after hitting its lowest level since Dec. 18 on Monday. U.S. gold futures rose 0.4% to $2,041.20 per ounce.

Sensex Today | Prabhudas Lilladher View Capital goods sector:

Capital goods under coverage universe to report healthy performance in Q3FY24 led by 1) continued execution of strong opening order books, 2) robust demand/orders/volumes in domestic market, and 3) traction in key export markets such as Middle East, Americas, Africa etc. 

Overall, brokerage house expects Revenue/Adj. PAT growth of ~16.6%/22.0% YoY (13.5%/14.1% YoY ex-L&T). 

Margin guidance, European demand outlook, order/enquiry pipeline and impact of elections on domestic demand/orders will be key monitorables. 

Top picks are L&T, Siemens, ABB, Triveni Turbine, and Praj Industries.

Sensex Today | BSE Realty index up 2 percent led by Godrej Properties, DLF, Oberoi Realty:

-Overweight call, target raised to Rs 890 per share
-JLR posted wholesale volumes of 1.01 lakh units, +27% YoY, broadly in-line with estimate
-JLR could be next big re-rating driver for Tata motors if performance is steady
-Q3 mix remained strong, with RR, Sport, Defender forming 62% of wholesale
-76% of order backlog vs 77% in Q2
-Company did not comment on FCF, but believe JLR’s FCF momentum will continue

Zee today issued a statement calling the news report of Sony's plan to terminate merger as factually incorrect. Zee Ent in a statement to stock exchanges said that the company is committed to the merger and is trying to work towrds closing the deal with Sony.

Shares of IRB Infrastructure Developers soared 8 percent to hit a 52-week high of Rs 45.55 on January 9 after the company reported a strong growth in toll collections for December.

The company collected Rs 488 crore in toll in December, up 26 percent from Rs 388 crore in the same month of the previous fiscal.

-Downgrade to sell, target Rs 1,729 per share
-Valuations running ahead of fundamentals
-Build in 12.5% volume CAGR over FY23–26
-See limited scope for further improvement in margin
-Limited scope in margin improvement as RM cost benefits are largely factored in
-Limited scope in margin improvement as EV expansion is set to weigh down on profitability
-Find valuation of 40x 1-year forward EPS exorbitant & that limits stock upside

Sensex Today | Market at 1 PM

The Sensex was up 647.98 points or 0.91 percent at 72,003.20, and the Nifty was up 201.30 points or 0.94 percent at 21,714.30. About 2225 shares advanced, 1051 shares declined, and 69 shares unchanged.

IRM Energy signed MoU with Tamil Nadu government to invest Rs 858 crore project in the state over the next 5 years as part of the Tamil Nadu Global Investors Meet 2024, Chennai. The projects will provide employment to 2200 people in the state.

HDFC Life premium up 3.3 percent, Individual APE down 8.6 percent, Total APE up 3.3 percent, YoY
ICICI Prudential premium up 3 percent, Individual APE up 4.2 percent, Total APE up 2.9 percent, YoY
Max Life premium up 18 percent, Individual APE up 25.7 percent, Total APE up 21.9 percent ,YoY
SBI Life premium up 21 percent, Individual APE up 21.8 percent, Total APE up 21.2 percent, YoY
LIC premium up 94 percent, Individual APE up 2 percent, Total APE up 22.6 percent., YoY

-Sell call, target Rs 5,600 per share
-Buyback announced at Rs 10,000 per share, promoters expected to participate
-Company will buyback 1.41% of total equity shares on proportionate basis from existing shareholders
-Buyback price is pretty steep but promoters are also expected to participate
-Promoters’ participation implies the promoter group will potentially receive Rs 2,200 crore
-Stock has already seen run-up 6%
-Stock run-up on news of board meeting announcement for buyback of shares on Jan 3, 2024

Aurobindo Pharma announced it received the establishment inspection report from US FDA for its Telangana unit. The report classified the facility as “Voluntary Action Indicated”.

Sensex Today | Prabhudas Lilladher View on Telecom Sector

Q3FY24 Revenue and EBITDA of telecom companies under coverage (Jio (unrated) + Bharti) is expected to increase by 3%QoQ and 4% QoQ to Rs 617.9 bn and Rs 324.7 bn respectively led by healthy subscriber addition of 13.2mn, besides building gradual increase in ARPU growth (1.1%QoQ). 

Due to falling competitive intensity, given weak financial position of peers, broking firm maintain positive stance on the sector. 

It also factor in delayed tariff hikes and build in ARPU of Rs 225/236 for FY25/26. Reiterate ‘Accumulate’ on Bharti at SOTP based Target Price of Rs 1088.

Sensex Today | BSE Auto index rose 1 percent led by Apollo Tyres, Hero MotoCorp, Samvardhana Motherson International:

Airtel Business – the B2B arm of Bharti Airtel today announced that it will power over 20 million smart meters for Adani Energy Solutions Limited (AESL).

Board of Directors of Steel Strips Wheels at its meeting held on January 09,2024, have approved to infuse funds in the AMW Autocomponent Limited.

Datamatics, a leading global Digital Technologies, Operations, and Experiences company, today announced a new partnership with OutSystems, a global leader in high-performance application development, offering an enterprise grade low-code platform that empowers businesses to transform and accelerate software development and delivery.

IndusInd Bank today announced the launch of the UPI-enabled ‘IndusInd Bank Samman RuPay Credit Card’, in collaboration with National Payments Corporation of India (NPCI).

Coal India Limited (CIL) has begun tranche-VII of the linkage auction to non-regulated sector (NRS) within days of completion of tranche-VI.

The company has proactively increased the tenure of fuel supply agreement (FSA) to 10 years, beginning with seventh tranche, to ensure long term assurance of coal supply through linkage auction to NRS.

Sensex Today | BSE Smallcap index up nearly 1 percent led by PNB Gilts, Praveg, Wardwizard Innovations and Mobility:

Power Grid Corporation of India will float bonds to raise up to Rs 2,200 crore on January 10, market sources have said. The bond issue will have a base size of Rs 500 crore and a greenshoe option of Rs 1,700 crore. The bonds will mature on January 11, 2034. READ MORE

Over the last 12-15 months, Bajaj Auto's two-wheeler business has started to regain momentum and look after weathering a perfect storm, Dinesh Thapar, CFO of the company said in an interview with CNBC TV-18. Thapar further suggested that the automobile major has assumed pole position in the 125 cc segment. READ MORE

The Indian market opened gap-up after a rally in the US markets and strong gains in Asian indices. All the sectoral indices traded in the green with the Information Technology index up 1.5 percent and BSE Midcap and Smallcap indices in green on January 9 morning. READ MORE

The positive trend in the housing demand will likely stay intact in the calendar year 2024, global brokerage firm Jefferies has said, adding the residential market volume surged 20 percent in 2023, doubling over the past three years. READ MORE

The multi-business Adani Group has decided to invest a whopping Rs 42,768 crore in Tamil Nadu in renewable energy, cement manufacturing, data centre, city gas distribution and generate 10,300 employment opportunities, according to Economic Times report.

The Group announced this decision during the Tamil Nadu Global Investors Meet 2024 held on Monday, it added.

Bharat Forge has entered into a Memorandum of Understanding (MoU) with Guidance, the Nodal Agency of Government of Tamil Nadu on January 08, 2024 as part of the Tamil Nadu Global Investors Meet 2024, for investing up to Rs 1,000 Crores over a 5-year period to expand our manufacturing footprint in Tamil Nadu.

This MoU is non-binding and at present does not have a material impact on the operations of the company.

Tata Motors subsidiary Jaguar Land Rover (JLR) announced 27 percent YoY growth in Q3 sales to 101,043 units. YTD wholesales for FY24 were 291,113 units, up 28% year-on-year. Retail sales went up 29 percent to 109,140.

Sensex Today | Market at 11 AM:

The Sensex was up 554.77 points or 0.78 percent at 71,909.99, and the Nifty was up 167.80 points or 0.78 percent at 21,680.80. About 2198 shares advanced, 1006 shares declined, and 77 shares unchanged.

Sensex Today | KRChoksey View on Bank

Banks are expected to see a deliberate deviation in the share of unsecured loans after the RBI’s risk weight announcement. 

Broking house will remain watchful of the management commentaries in regard to this and its growth outlook going forward. 

It remains positive on the overall banking sector, especially HDFC Bank (2.5x FY25E P/ABV), ICICI Bank (2.4x FY25E P/ABV), and SBI (1.3x FY25E P/ABV), which remain top picks for Q3FY24E.

The Buildings & Factories (B&F) Business of Larsen & Toubro (L&T) Construction has secured an order from HITES (A Mini Ratna PSU) under the Ministry of Health and Family Welfare.

The Health Business Unit of the HRC SBG has secured an order to construct a new AIIMS at Rewari (Haryana) on a Design, Engineering, Procurement and Construction (EPC) basis in Q3 FY’24.

The facilities will include a 720-bed Teaching Hospital, a 30-bed AYUSH Hospital, an 100 students’ annual intake Medical College, Nursing College, 500-seat Auditorium, Hostel & Residential facilities to be executed within stringent timelines. The total built up area is 1.5 Mn Sq. ft.

The scope of work involves Civil structure, Finishes & allied MEP services including built in Furniture, Supply, Installation, Testing & commissioning of Medical Gas Piping, Modular OT, Pneumatic Tube System, Nurse Call System, Central Sterile Supply Department & external development works including landscaping.

Sensex Today | BSE Realty index rose 1 percent led by Godrej Properties, Brigade Enterprises, Phoenix Mills:

Today, all sectoral indices are currently showing positive trends driven by favorable global signals. In the Nifty, the 21700 Call strike stands out with a significant Open Interest (OI) of approximately 95 lakh shares. Conversely, on the Put side, the 21500 strikes have notable OI of around 60 lakh shares. The immediate resistance for Nifty is identified at the 21700 levels, while the support zone ranges from 21450 to 21525.

For Bank Nifty, a robust support range is observed between 47,200 and 47,400. Within Bank Nifty, the 47800 Call strike holds a meaningful OI of approximately 42 lakh shares, while on the Put side, the 47500 strike has a substantial OI of about 23 lakh shares. Despite positive global sentiments, the domestic scenario is relatively subdued. However, any potential correction in the market is viewed as a buying opportunity.

Shares of Inox Wind rose 2 percent in the opening trade on January 9 after the company was awarded a wind power project by NLC India.

"The company has received a Letter of Intent (LoI) for executing a 50 MW ISTS connected wind power project on a turnkey basis from NLC India Limited, a Navratna CPSU," it said.

As part of the project, Inox Wind will supply, install and commission its DF 113/92 - 2.0 MW capacity Wind Turbine Generators (WTGs), and provide comprehensive operations and maintenance (O&M) services for over 10 years after commissioning.

Cipla announced JV in the US with Kemwell Biopharma and Manipal Education & Medical Group to develop and commercialise novel cell therapy products for unmet medical needs in US, Japan and EU.

The share price of BEML gained in the opening trade on January 9 after the company won an order from the defence ministry.

"The company has bagged orders from Ministry of Defence for supply of mechanical minefield marking equipment Mark-II valued at approximately Rs 329.87 crore," it said in a release.

The Gensol Engineering stock gained 5 percent in opening trade on January 9 after the company executed a Memorandum of Understanding (MoU) with the Gujarat Government for Electric Vehicle Manufacturing.

"......... has executed Memorandum of Understanding with the State Government of Gujarat for an investment of Rs 2,000 crore for Electric Vehicle Manufacturing. It will generate around 1,500 jobs in the region," the company said.

The Memorandum of Understanding has been signed with the State Government of Gujarat for an investment of Rs 2,000 crore for Electric Vehicle Manufacturing.

Royal Enfield signed non-binding MoU with Tamil Nadu government to invest Rs 3000 crore over 8 years to build greenfield and brownfield projects in the state as part of theTamil Nadu Global Investors Meet 2024, Chennai.

Sensex Today | BSE Realty index up 1 percent supported by Brigade Enterprises, Phoenix Mills, Godrej Properties:

Aurobindo Pharma share price gained in the opening trade on January 9 after the company received establishment inspection report from the US Food and Drug Administration (USFDA).

The USFDA had inspected the pharma firm’s formulation manufacturing facility in Chitkul in Telangana in September. The establishment inspection report has classified the facility as "Voluntary Action Indicated" (VAI).

SG Mart share price touched 52-week high of Rs 10,715.20 in the early trade on January 9 after the company's board approved a bonus share issue and sub-division of equity shares.

On January 8, the board approved a 1:10 split of the company’s equity shares - one share having a face value of Rs 10 to be divided into 10 shares of rupee 1 each-- subject to the approval of shareholders

The board also approved issuance of bonus shares to the shareholders in the ratio of 1:1 — one share for every one equity held.

Sensex Today | Market at 10 AM

The Sensex was up 365.30 points or 0.51 percent at 71,720.52, and the Nifty was up 115.60 points or 0.54 percent at 21,628.60. About 2202 shares advanced, 883 shares declined, and 80 shares unchanged.