Today’s Market Summarised

A red day to ned the week. Markets close in deep red with financial stocks leading the fall.

After opening at 14,777 with a 120 point gap-down, Nifty tried to move up. 14,850 was taken as a good resistance and then the market did not move up further. Instead, it consolidated for many hours. At around 1 pm, sharp selling started and markets fell consistently till the closing time. Nifty closed the day at 14,631, down 263 points or 1.77%.

Bank Nifty opened with a huge gap-down of 500 points at 33,714. Since the index was not in a mood to move, it consolidated in a tight range till 1 pm. Just like Nifty, the index fell heavily in the last 2 hours. Bank Nifty closed the day at 32,781, down 932 points or 2.77%.

Fin Nifty was down 3% at the close, followed by Bank Nifty(down 2.77%). Only Nifty Pharma closed in the green, up by 1.28%. Nifty Auto and Nifty FMCG closed 1-1.3% down.

Major Asian markets mostly closed in the red. European markets are currently trading in the red. 

News Picks

Maharashtra govt extends lockdown restrictions till May 15. Not a good sign for the market, along with the vaccine shortage worries. PVR fell another 4.4% in trade.

AU Small Finance Bank reported an over 38 per cent rise in net profit at Rs 168.98 crore for the last quarter of fiscal ended March 2021. But, the spike in gross NPAs up to 4.25% in March 2021 from 1.68% concerned investors. Sharp selling was seen and the stock closed 10% down.

These worries hit the entire finance sectors hard. HDFC and HDFC Bank closed more than 4% down each. 4 out of the top 5 Nifty 50 losers were finance stocks.

Abu Dhabi National Oil Company (ADNOC) cut the July term oil supply by 20% to some buyers in Asia. Reduction of supply could mean an increase in prices, hence many energy sector companies rallied in the morning.

Nifty 50 top-gainers included 4 companies from Nifty Energy. ONGC(up 4%), Coal India(up 4%), IOC(up 2.19%) and BPCL(up 0.54) were in the list.

Nestle is planning to buy vitamin brand Bountiful Co. from American Global Investment firm KKR for Rs 42,600 crore.

Promoters of JSW Energy releases pledge on 1.3m shares from April 26-27. Share prices closed nearly 1% up in the bearish market.

Marico reported a consolidated net profit of Rs 220 crore for the Jan-March quarter, up 23% YoY. Revenue up 34% YoY to Rs 2,012 crore. Share prices jumped nearly 5% after the announcement but closed flat.

Havells India’s CEO has said that they are reducing production across factories as demand is down by 30%. Share prices fell from the green to close 2.4% down in the day.

Wipro has partnered with Citrix and Hewlett Packard Enterprise to accelerate remote working solutions and bring modernisation into workspaces. Wipro shares went up till 4% in the morning session, but closed flat.

Markets Ahead

The results of AU Small Finance Bank have highlighted the risks for investors in finance companies. The rising NPA cases have always been a cause of worry, but HDFC Bank and ICICI Bank posted really good results.

But it is a chain reaction which the industry does not want to go into. A series of NPAs across banks will be hard on the entire financial system of the country. This is mostly why the sector fell sharply today.

Confidence might soon come back in those companies which are big enough to raise capital to sustain. That is companies like market leader HDFC Bank or the government-backed SBI.

And like we discussed yesterday, the sell-off after Nifty hit 15,000 was very much expected to continue today as well. Profits are being booked by DIIs who rode the wave from 14,150 to 15,000.

Nifty has fallen 150 points from the opening level of April 1, to create 2 back to back red candles in the monthly chart. 

A quick jump is expected in the first days of May, and the next time Nifty tests 15,000 it will be very decisive. Chances are the 15,000 resistance is here to stay for a bit more. 

But keep getting into your favourite stocks in these dips, because the market is here to stay and it will go up eventually. But when? We will have to see.

Catch you all on The Stock Market Show tonight!