Today’s Market Summarised

A day of heavy sell-off across all sectors in the market afternoon.

Nifty opened the day at 14,824 with a small gap-down and started falling. Once 14,800 was broken in the first 5 minutes, the fall continued. In the first two hours of trade, the index had fallen 130 points. With an unsuccessful try for a pullback, more sell-off was seen after 1 pm.

After taking support at 14,650, Nifty closed the day at 14,696, down by 154 points or 1.04%. 

Bank Nifty opened at 32,720 and mostly moved in a similar way to Nifty. After the initial fall, HDFC Bank and SBI tried to pull up the index. Even though HDFC Bank fell later, SBI continued to move up. But in the last hour, all stocks fell once again. Another day of PSU Banks vs Private Banks helped the index consolidate.

Bank Nifty closed the day at 32,452, down 420 points or 1.28%.

All sectoral indices closed mixed. Just like yesterday, Nifty PSU Bank(up 3.24%) shined in the day. Nifty Metal(down 2.97%) saw heavy profit booking. In the other indices, only Nifty Bank(down 1.28%) and Fin Nifty(down 1.23%) moved by more than 1% to either side.

Most Asian markets closed in the red, which led to the gap-down opening today. European markets are trading flat at the time of Indian market close.

News Picks

Cadila HC jumped 2.7% up after it sold its animal healthcare business to a list of investors including the Canada Pension Plan Investment Board and Rakesh Jhunjhunwala’s RARE Enterprises. The deal for Zydus Animal Health was completed for Rs 2,921 crores. 

Wholesale vehicle sales data from the Society of Indian Automobile Manufacturers (SIAM) is out. Retail sales of commercial vehicles is down 23.7% at 51,436 units in April compared to March. Retail sales of passenger vehicles are down 25.3% Month on Month to 2.08 lakh units. 

Sales of tractors grew 16% while all other vehicle categories declined considerably. But all this was as expected, due to the second wave of Covid-19 and lockdowns. Hence the auto stocks did not react much.

NMDC has hiked iron ore prices by Rs 700/tonne and prices of fines by Rs 1,500/tonne. The stock hit a day high 7% up, but later fell along with Nifty and closed just 3% up.

Cabinet announces boost for electric vehicles. The PLI scheme for battery storage goods is aimed at increasing Electric Vehicles production. Amara Raja Batteries(up 2%), Tata Chemicals(up 3.6%) and Exide(down 0.13%) moved well from their day-lows.

Mahindra & Mahindra said its sales volume for the quarter ended June 2021 is estimated to be lower by 15-20 per cent as compared to the year-ago period. The stock closed 2% down.

Meanwhile, Tata Motors rallied 6% up from yesterday’s close but fell near market close. The stock ended 3.3% up at Rs 326.

Voltas has reported a Q4 net profit of Rs 238 crores, up 49% YoY and 79% compared to last quarter. The stock is down by 3.8% after profit booking kicked in. Was up nearly 3.8% yesterday.

After the Government of India asked Bharat Biotech and Panacea to come together and ramp up production of Covaxin, Panacea Biotech hit its 5% Upper Circuit again. The stock is up more than 40% in the last 30 days.

Asian Paints reported Q4 net profit posted as Rs.850 crores, up 84% YoY but down 31% compared to last quarter. The stock closed flat after a volatile day of trade.

Vodafone Idea added 6.5 lakh subscribers in February, thereby adding customers for the first time in 15 months. The stock closed 8.6% up.

Godrej Consumer Products reported a 59.13% YoY increase in net profit to Rs 365.84 crore for Q4. But interestingly, the appointment of a new MD and CEO, Sudhir Sitapati from Hindustan Unilever, boosted the stock to close 21% up.

Godrej Industries has a 23.6% stake in GodrejCP. GodrejInd went up 20% but fell from there to close 9% up for the day.

Nifty PSU Bank is up 3.2%. PNB, Union Bank, Uco Bank, Central Bank are up more than 5%. All stocks in the index closed in the green.

Monsoon is approaching and fertilizer stocks like NFL(+9%), FACT(+4.5%), ChambalFert(+10%), RCF(+3.3%) gained heavily.

Just after-market hours, UPL has reported Q4 consolidated net profit posted at Rs.1063 crores, up 72% YoY and 34% compared to the last quarter along estimates.

After the dream rally of multiple days, it was a day of profit booking in Nifty Metal.

Hindalco(-3.3%), SAIL(-5.8%) NationAlum(-5.7%) Jindal Steel(-4%) were the most shattered ones among Nifty Metal. Tata Steel, the top loser of Nifty 50 is down by 4.4% followed by JSW Steel(down 3.5%).

After market closed, Jindal Steel has reported Q4 consolidated net profit at Rs 1968 crores , up 975% YoY and down 12% compared to last quarter. 

Shares of Venky’s gained 17.6% after posting good results on Monday. The stock is up 31% in the last 5 trading days.

Packaged Food and Meat Industry stocks like Avanti Feed(5%), Apex Frozen(6%), Waterbase(3%) and KRBL(6%) had a good day in Indian Market.

Markets Ahead

All districts in India with 10%+ Covid-19 positivity rates need to remain locked down for 6-8 weeks, ICMR Chief has advised. That will be more than 2 more months of lockdowns in all major districts, if imposed.

A negative close in the markets ahead of tomorrow’s holiday. But a volatile expiry after last week’s calm Thursday. We had discussed yesterday that the market may fall further if global indices continue to be red. Expected 14,800 to be a good support in the day, but once this was broken, it was a good indication of bearishness.

Profit booking continued to rock metal stocks, with top stocks closing significantly down in the last 2 days. Those still bullish for the long-term can plan entries when these stocks start moving back up.

The volatile day was expected as it was a weekly expiry. 14,500 continues to look like a good support for the next week but a fall below this will lead straight to 14,250 -’300 levels. Reliance continues to be weak, down 1% today. The only hope for a reversal in the market will be highly bullish results from SBI, who closed in the green in between a bearish market.

Even if this happens, 15,000 does look like a strong resistance in the very short term, with sell-offs happening at that range and buying happening at 14,200 ranges.  

Eid is to be celebrated on the 14th in India, so advanced wishes to all. Tomorrow being a market holiday, take some time of to spend on studying some good charts!

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!

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