Today’s Market Summarised

Nifty ends in red after 4 consecutive days of closing in the green.

Nifty opened the day at 14,797 with a 150 points gap-down and started to move up. But right in the morning, Nifty traded in a 25 point range for more than an hour. After breaking out, 14,900 was tested and the index fell from there sharply.

Nifty closed the day at 14,850, down by 91 points or 0.61%. Even with the fall, a green candle was formed in the daily charts.

Bank Nifty opened at 33,692 with a 450 point gap-down. It tried to move up but mostly consolidated. But just after 11 am, a move from both private and public banks sent Bank Nifty up. This positiveness was not sustained, and all major banks including HDFC Bank fell sharply. Bank Nifty closed the day at 32,872, down 270 points or 0.82%.

All sectoral indices closed mixed. Only Nifty PSU Bank(up 1.12%)  closed more than 1% in the green among major indices. Also, only Nifty Financial Services(down 1.29%) closed more than 1% down. Nifty Energy gained nearly 1.7%.

Major Asian markets closed in the red, with Japan’s index closing more than 3% down. European markets are all in the red, down 2% each.

News Picks

Metals saw profit booking after many days of rally. SAIL(down 4%), JSW Steel(down 3.22%). Hindalco(3%) and JindalSteel (down 2.86%) led the fall. This could be attributed to China’s exchanges trying to cool down metals prices.

Interestingly, Tata Steel closed in the green, up by more than 1%. From the gap-down opening, the stock closed more than 4% up.

JSW Steel’s April crude steel production down 5% from last month at 13.7 lakh tonnes due to medical oxygen production. The stock closed more than 3% down.

More and more states are announcing lockdowns. Telangana and Nagaland join other states with strict lockdowns.

JSW Hydro Energy raised Rs 5,200 crores from International Bond markets. Parent company JSW Energy is up 1% in the day, and 30% up in the last 30 days.

All top 6 gainers in Nifty 50 are from the Energy sector.

Oil refiners and marketing companies gained in the day after prices of petrol and diesel were raised for the sixth time in recent weeks. 

IOC(up 4.6%), BPCL(up 1.88%), MRPL(up 7.5%) and Hindustan Petro(up 3.9%) gained sharply.

Meanwhile, Coal India(up 5.9%) and NTPC(up 4.65%) gained once again to become Nifty top-gainers. As we discussed yesterday, dependency on imported coal is being reduced and e-auctions of coal is going good. NLC India closed nearly 20% up in the day.

UPL announces collaboration with Japanese company Meiji to develop and commercialize insecticide for rice(Flupyrimin) in Southeast Asia. The stock closed 1.45% up.

Moody’s changed the Airlines Industry outlook to positive. SpiceJet closed up 9%. Indigo closed flat. Soon, Wadia-group owned GoAir is coming out with its IPO.

IndiaBulls Housing sells mutual funds business to Groww for Rs 175 crores.

Cadila Healthcare has started dispatch of Virafin, to be used for Covid-19 treatment. Shares gained more than 1%.

UP Govt has floated tender to procure 40 million Sputnik vaccine in next six months. Dr Reddy’s closed flat in the red.

Shares of BHEL once again gained nearly 12% as PSU shares continue to fly high. CONCOR(up 5.6%), GAIL(up 4.7%), BEML(up 5.4%) are some notable other names.

Shares of Alkyl Amines closed 10% in Upper Circuit after the stock split.

Markets Ahead

Nifty has once again failed to cross the 15,000 resistance. It is acting like an invisible barrier due to the fears of Covid-19 second wave shaking up the country. Banks are looking weak too, with Kotak Bank down nearly 3% in the day.

Metal prices are trying to be controlled in China by exchanges, as traders drive-up price. This has lead to a fall in metal stocks. But I do believe it is only temporary and a good opportunity to look into those stocks which did give good moves earlier. But do enter with strict stop losses.

With tomorrow being the weekly expiry, we can expect some good volatility. But with the current data, we can see Nifty is most likely to close between 14,800 and 15,000 tomorrow.

One interesting thing is, global markets are all down 2-3% but Nifty is only down 0.6% in the day. If they continue to fall tomorrow, we may see a bigger reaction from our markets.

Equity mutual funds see inflows for 2nd straight month at Rs 1,783 crore in April. This is still very much lower than the inflow of Rs 7,376 crore in March. DIIs have been buying near the 14,000 supports as you have seen.

Hoping you had a great day in the market today. And as always, stay safe and stay home if you can. Keep studying charts and improve your skills.

Catch you all on The Stock Market Show tonight!