Today’s Market Summarised

Nifty stabilises after two days of fall. Markets closed in the green, even after falling from their opening levels.

Nifty opened the day at 16,592 with a gap-up but saw a big sell-off. In less than 2 hours, the index fell nearly 200 points. Support was taken at Friday’s low of 16,400 and the market bounced back up. Nifty saw consolidation in the afternoon, and closed the day at 16,496, up 46 points or 0.28%.

Bank Nifty opened at 35,427 with a 400 point gap-up but could not sustain. The index fell more than 600 points from this opening level but took support at 34,800. After a slight recovery, Bank Nifty closed the day at 35,124, up 90 points or 0.26%.

Nifty IT(+1.7%) was the major sector to close in the green. Nifty Auto(-1.4%) and Nifty Media(-1.7%) closed in the red.

Most Asian markets have closed in the green today. All the European markets are currently trading in the green.

News Picks

After the rally of FMCG stocks on Friday, IT stocks moved up today. The top-gainers of Nifty included HCL Tech(+4%), TCS(+2.1%), Wipro(+1.4%) and TechM(+1.2%).

Some FMCG stocks continued bullishness with Nestle(+2.3%) leading the rally. VBL(+3.3%), Emami(+2.9%) and Hindustan Unilever(+0.5%) also closed in the green. 

Ujjivan(-14.6%) and Ujjivan Small Finance Bank(-6.3%) continued their fall from Friday, after the resignation of MD & CEO Mr Nitin Chugh from Ujjivan SFB.

Aditya Birla Group’s companies Grasim(-2.9%) and UltraTech Cements(-1.9%) featured in the top-losers segment of Nifty 50. 

Other stocks of the group including AB Capital(-8.9%), AB Fashion(-3%), AB Money(-7.3%) also moved down. Hindalco is down 7.5% in the last 5 trading days, while Idea has fallen nearly 30% in August

Adani stocks were under pressure with SEBI’s eye on the group again. SEBI has put Adani Wilmar’s IPO on hold for now. Adani Ent(-2.3%), Adani Ports(-2.7%), Adani Power(5%-LC) closed in the red. However, Adani Trans and ATGL closed in the 5% Upper Circuit.

Escorts(+5.3%) continued to bounce back from near 52-week lows and closed in the green today. New India Assurance(18.3%), Hatsun Agro(10.3%), Mahindra Logistics(+9.2%) also closed with good gains from Nifty 500.

HeroMoto Corp(-0.6%) and Biocon(-6.7%) also closed at their 52-week lows, while Tata Motors made a 6-month low.

Zomato(-8.6%) saw heavy selling with the lock-in period for anchor investors ending today. More than 7% of the total equity in the company was held by anchor investors as of yesterday.

Telecom data for June 2021 showed that Bharti Airtel(+1.4%) added 38.1 lakh users in June after losing 46.1 lakh customers in May. Reliance Jio added 54.6 lakh users in June vs an addition of 35.5 lakh in May. Reliance closed 0.6% up.

Vodafone Idea(+0.8%) managed to stay in the green after losing 43 lakh users in June. This was after reports that the government may allow telecom companies to pay the AGR dues over a period of 20 years, doubling the current period of 10 years.

India’s fifth-largest cement maker Nuvoco Vistas listed in NSE at a 15% discount of Rs 485 to the issue price of Rs 570. Other cement stocks also saw selling pressure with UltraTech(-1.9%), Shree Cements(-1.1%), JK Cements(-2.6%), Ramco Cements(-1.1%) and more closing in the red.

HDFC Bank(+0.6%) said that it aims to regain lost card market share in 3-4 quarters and will issue 3 lakh credit cards per month from the next quarter.

Cadila Healthcare(+2.2%) to seek approval for ZyCoV-D trial on 3-12 age group within 10 days. Will be uniquely positioned as the first to get approval for use in children.

Arvind Fashions(+9.2%) has raised Rs 439 crore from various investors including promoters by issuing equity shares of the company.

Steel stocks remained under pressure with SAIL(-3.2%), Jindal Steel(-3.5%), NMDC(-2.7%) and Tata Steel(-1.2%) seeing selling.

Markets Ahead

Markets are currently witnessing a sectoral rotation, with smart money continuing to flow into the defensive stocks. TCS and HCL Tech together contributed 28 points to Nifty’s 45 point rally today.

Many IT companies including HCL Tech, L&T Tech, Mindtree, Mpahsis, TCS and Tech Mahindra have hit their 52-week highs today. These stocks are expected to cool off soon, as money redistributes to other sectors.

To be more precise, whenever they start cooling off, we may see other sectors gain back.

Reliance and HDFC Bank have also been making small contributions to the index in the past few days, pushing Nifty up by 17 points today. As we have been discussing, the uncertainties surrounding the stocks have now lifted, and the next round of bullishness may be lead by them.

Midcaps and smallcaps continue their weakness. Just because they are falling, don’t jump the gun and average your holdings. Add those stocks which continue to show strength even in this correction phase.

How did Monday go for you? Even with Nifty consolidating, how is your portfolio looking? Let us know in the comments of the marketfeed app.

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