Today’s Market Summarised

Today’s Nifty chart followed a very similar pattern as that of yesterday. Trading for the day opened just under 11,250, flat, as indicated by SGX Nifty. The index moved up and down throughout the day but overall consolidated within yesterday’s trading range. After taking support near 11,180 at 10 am, Nifty went up 100 points to find a strong resistance at the 11,280 level. Even though the index eventually broke this level after 2pm, it found resistance at 11,300 and fell sharply to close at 11,247.55, up 25.15 points or 0.22%.

With rumours floating around regarding the waiver of interest on interest by the central government, Bank Nifty was weak throughout the morning. After opening at 21,441, the index quickly fell 320 points by around 10am, pulling down Nifty as well. From there, it slowly gained confidence and went up to close at 21,451, up 40 points or 0.19% for the day.

Nifty FMCG was the top-gaining sector of the day, while Nifty Metal fell the most. Nifty IT and Nifty Pharma also gained, although the rupee has been getting stronger compared to the dollar.

Asian markets closed mixed for the day. European markets are currently trading in red, at the time of Indian market close.

News Picks

Shares of BPCL crashed over 10% from the day’s high to close at Rs 351.75, down 9.00% from yesterday’s close. Earlier, reports came out that oil companies Rosneft and Saudi Aramco are unlikely to bid in the privatisation of the refiner. Shares fell very gradually over the day giving a good shorting opportunity for traders. The Department of Investment and Public Asset Management (DIPAM) also said that the date for submitting the Expression of Interest (EoI) in Bharat Petroleum Corporation Ltd for the stake sale has been extended for the fourth time to November 16, 2020. This has made many people lose confidence in the stake sale.

Shares of PVR closed at Rs 1,214, up 1.34% after the government was said to be actively considering opening theatres in Unlock 5.0 guidelines. Shares hit a high of Rs 1,249 during the day’s trade. The company is also considering raising funds via NCDs on Oct 5.

Shares of Gati crashed to Rs 52.90, down 7.27% after Founder and MD Mahendra Agarwal resigned from the board of the company. 

Shares of Indiabulls Ventures Ltd jumped to Rs 247.85, up 2.04% after the company raised Rs 441 crore by selling shares to a clutch of private equity investors.

Shares of GMM Pfaudler jumped to Rs 3,983.80, locked at 5% upper circuit after recovering from last week’s crash due to its heavily discounted Offer For Sale (OFS). Multiple investigations are underway on the charges of insider trading by the promoters. Yesterday, Plutus Wealth Management had bought 1.65 lakh shares of GMM Pfaudler at Rs 3,528.75 per share from the open market.

Shares of HDFC Bank closed at Rs 1,078, up 1.45% after CEO and MD Aditya Puri gave positive commentary on the bank’s business getting back to pre-COVID level. Aditya Puri is all set to retire soon on October 26th. Sashidhar Jagdishan has been appointed as his successor, you can read our article about him here. 

Jindal Steel and Power Ltd (JSPL) became the first Indian private company to get a nod from Indian railways for regular rail track supply on passenger tracks. Shares fell to Rs 184.40, down 4.03% for the day. The company’s name was featured in the FINCEN files leaked last week. Read about the FINCEN leak here.

Shares of Panacea Biotec fell to its 5% lower circuit at Rs 181.50 after the US FDA gave the company’s Baddi facility in Himachal a warning letter. 

Shares inside the Nifty FMCG index, including GodrejCP, Dabur and Nestle India featured in the top-gainers list today to make FMCG the best performing sectoral index today. Shares of GodrejCP closed at Rs 724.95, up 2.77%,
Dabur closed at Rs 509.8, up 2.53% and Nestle India closed at Rs 15,923, up 1.92%.

Shares of Lakshmi Vilas Bank fell 6.68% to Rs 18.85 after its shareholders voted out seven directors of up for nomination, including Chief Executive Officer S Sundar on September 25. The major stakeholding companies were reportedly unhappy with the bank’s performance for at least the last two years. The Reserve Bank of India is looking into the matter closely.

Markets Ahead

Nifty has once again failed to break the 11,300 level and has been very range-bound. Tomorrow is the last trading day of this week, and also the weekly expiry day. We can expect even more volatility tomorrow. The US elections are getting intense, with the presidential debate getting very ‘un-presidential’ ending up in a cheap name-calling show between Trump and Biden. This scene surely has to be followed, with Trump promising on air a vaccine for COVID-19 in the coming weeks.

FMCG stocks, especially beaten down stocks like Tata Consumer Products, can be looked at for the upcoming week. Last week we had talked about how Manappuram might do well this week and it has gone up by around 12% in the last 5 trading days. Also, many European countries are considering more lockdowns as fresh COVID cases are touching all-time highs there. Keep watching this space for more.