Mid-day Mood | Indices volatile ahead of Budget 2024; media, oil & gas outperform

Stock Market Today

Equity benchmarks the Sensex and the Nifty moved between gains and losses in a choppy session on January 30 morning, as investors wait for the interim budget which will be presented by Finance Minister Nirmala Sitaraman on February 1.

The volatility index India VIX spiked over 4 percent intraday to hover around 16, indicating that investors were turning cautious ahead of the Union Budget and US Federal Reserve's rate meeting on January 31.

At 11.42 am, the 30-pack Sensex was down 211.86 points, or 0.29 percent, at 71,729.71, and the broader Nifty was down 25.90 points, or 0.12 percent, at 21,711.70. About 1,859 shares advanced, 1,288 declined and 68 remained unchanged.

The broader market traded higher. The Nifty midcap 100 index was up 0.25 percent and the smallcap jumped 1 percent.

Sectoral trends

Sectorally, Nifty media surged, with Zee Entertainment leading the pack on reports of an emergency arbitration hearing of the now junked Zee-Sony merger in Singapore. Nifty Oil & Gas was up 1.9 percent, as crude price gained on the deepening crisis in the Red Sea.

Fundamental view

The outlook suggests a sustained and broadening rally on Dalal Street if the Nifty stays above 21,389, market analysts said.

Positive factors include Wall Street nearing its all-time high, a growing US economy, easing inflation rates, a thriving artificial intelligence revolution, and optimism around the FM’s economic blueprint.

"Investors seemed hesitant to make significant decisions ahead of several key events this week, including a slew of mega-cap earnings, economic data and the Federal Reserve's monetary policy announcement on Wednesday.

"While the Fed is widely expected to leave interest rates unchanged, Investor will look for clues about the likelihood of rate cuts at upcoming meetings," Avdhut Bagkar of StoxBox said.

Technical view

"The next resistance for the Nifty is anticipated at the 22,000 level. Once breached, there is a possibility of Nifty testing the near all-time high of 22,124 levels.

"India VIX, a fear gauge, is hovering between 15-16 levels, indicating a surge in market volatility. Investors are cautious ahead of the Union Budget, as they expect the market volatility to escalate ahead of the Budget presentation," Om Mehra, Technical Analyst, SAMCO Securities, said.

After a decent consolidation, Bank Nifty has started to inch higher as it bounced sharply, taking support of 20 DMA. RSI is slowly gearing up and marked to end near 40 levels indicating there is enough headroom available for further rally, he said.

On the radar

Investors are also awaiting Fed interest-rate decision on January 31 and jobs market data later in the week. Going into this week’s two-day Fed policy meeting, investors are assigning roughly even odds to chances of the US central bank start to lower borrowing costs at its next decision in March.

BlackRock upgraded its overall outlook for US stocks to "overweight" from "neutral", as the world’s largest asset manager sees the S&P 500’s upward momentum continuing for the next six to 12 months amid cooling inflation and potential interest-rate cuts by the Federal Reserve, Deepak Jasani, Head of Retail Research, HDFC Securities, said.

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Key Nifty gainers

BPCL, Hindalco, ONGC

Key Nifty losers

Bajaj Finance, ITC, Bajaj Finserv

Key Sensex gainers

JSW Steel, Wipro, Hindustan Unilever

Key Sensex losers

Bajaj Finance, ITC, Bajaj Finserv

Stock moves

Zee: Zee Entertainment surged 8.9 percent on January 30 morning on reports that there will be an emergency arbitration hearing of the now junked Zee-Sony merger a day later in Singapore.

NTPC: The stock slipped 1.2 percent after the company reported a 7.3 percent rise in net profit in December quarter despite a 3.9 percent decline in revenue on January 30.

Mahindra Logistics: Shares fell 6.57 percent after the company reported a Rs 17.41 crore net loss in Q3FY24 against a net-profit status last fiscal.

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