Today’s Market Summarised

Nifty moves up towards the second half of the day and closes strongly in the green.

Nifty opened the day flat at 17,665 and consolidated with resistance near 17,710. Just after 12:40 PM, the index gave a proper breakout.  The bullishness was seen and the index shot up more than 120 points in 2 hours. Nifty closed the day at 17,822, up 131 points or 0.74%.

Bank Nifty opened the day at 37,503 and consolidated all through the morning. Along with other indices, Bank Nifty also moved up in the afternoon. After consolidating near yesterday’s high for a while, the index moved up once again but could not test 37,800. Bank Nifty closed the day at 37,741, up 161 points or 0.43%.

Nifty IT(+1.1%) moved up considerably in the second half of the day. Nifty Realty(+1.3%) moved down.

Asian markets closed mixed in the day. European markets are all trading in the green currently.

News Picks

ONGC(+10.8%) shares hit a 2-year high with crude oil prices moving to their highest level since 2014. 

Other energy-related stocks including IOC(+2.8%), Reliance(+2%), BPCL(+1.8%) and even Coal India(+4.2%) closed in the top-gainers list of Nifty 50. Multiple agencies had given positive commentary for these companies as price hikes on gas came into effect.

Coal Ministry in its next year agenda said that Coal India should diversify its business & explore prospects in areas like EVs & charging stations.

Reliance touched a fresh all-time high above Rs 2,600 with a market cap reaching Rs 17.5 lakh crores.

Cipla(-2.4%) continued its second day of featuring in the top-losers list of Nifty 50. The stock is seeing a rejection near its 52-week high. SunPharma(-1.3%) also closed in the red.

The Government of India told the Supreme Court that it may not try the recovery of spectrum user charges from telecoms. Bharti Airtel(+2.6%), Indus Tower(+1.9%), Vodafone Idea(+1.3%) and even IndusInd Bank(+4.3%) moved up after this news. However, the Supreme Court was not keen on the idea.

TATA Power(+6.4%) and TVS Motors(+0.27%) entered into an agreement to collaborate on an electric two-wheeler charging eco-system in India.

Paper prices have increased by Rs 2,000-3,000/MT in October. Paper stocks – JK Paper(+5.9%), Orient Paper(+3.2%), Andhra Paper(+3.1%) and STAR Paper(+2.2%) closed in the green.

With Term Insurance prices expected to increase, Life Insurance stocks gained in the day. ICICI Prudential(+0.35%), SBI Life(+2.5%) and HDFC Life(+0.89%) closed in the green.

PEL(+4.8%) shares continued their rally to reach a 3-year high after completing the acquisition of DHFL.

Realty and Metal stocks closed mostly in the red with many including National Aluminium(-2.5%), Godrej Properties(-2.2%), DLF(-2%), and Hindalco(-2%) correcting after touching fresh 52-week highs yesterday.

Bharti Airtel’s- 21,000-crore rights issue opened today. Read more about rights issues here

Gas prices in Europe are at new historic levels. GujGas(+2.9%), GAIL(+1.9%) also closed in the green along with ONGC and Reliance.

Markets Ahead

India’s September Services PMI was at 55.2, increasing expansion but at a slower rate compared to last year. There were also new hirings after nine months and demand recovery for Indian companies.

Nifty has given a strong bounce back from its 17,450-17,500 support zone. Major stocks in the index, especially IT shares moved up despite the tech sell-off around the world. We had yesterday discussed that they could bounce back up from current supports ahead of the Q2 results announcements.

Reliance breaking out and sustaining above Rs 2,600 may cause more rally in the stock. IT stocks are also expected to move up in the coming days. So there will be pressure of profit booking on financial stocks including Banks and NBFCs like HDFC.

The European markets in the green and U.S. Futures also indicate a gap-up tomorrow. Let us keep watching 17,850 and 17,950 levels in Nifty as resistance and 17,660 as support. In Bank Nifty, you can watch 37,880 and 38,000 as resistances with 37,400 and 37,000 as supports.

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