Today’s Market Summarised

  • Nifty had a gap-up opening today just above the 11,450 level. The index fell gently over the day and was mostly in a consolidation mood between 11,410 and 11,450. The index could not sustain above the 11,450 level, and the gap-up opening was eventually covered by the end of the day. The Nifty 50 index closed the day at 11,408.40, up 23 points or 0.20%.

  • Bank Nifty too had a gap-up opening at 22,324, tracing Nifty 50. We witnessed heavy consolidation of the index over the day between 22,260 and 22,400. By market close, the sectoral index closed at 22,285.90, up 115 points or 0.52%.

    Nifty PSU Bank index, which tracks the public sector banks in the country, jumped by 2.36%. Yesterday, reports had come out that the Government of India is planning to fast-track the stake sale in four Public sector Banks (PSBs).

  • Nifty Media jumped 5.36% to become the top performing sectoral index of the day. We saw its constituents including ZEEL, InoxLeisur, PVR and DishTV all moving more than 5% today. ZEEL was the top gaining stock in Nifty 50 today, going up 14.06%.

  • Asian markets were mixed today. European markets are all trading in green at the time of market close.

News Picks

  • Reliance Communications’ advocate has informed the Supreme Court that the company will be forced into liquidation if sale of spectrum is not allowed. The AGR hearing is currently under progress and will be fully updated in Today’s Top 10 news article.

  • Muthoot Finance shares jumped to ₹1,292 but saw profit booking to close at ₹1,247, up ₹9.10 or 0.73%. Earlier in the day, the Non-Banking Finance Sector lender posted amazing results during market hours with net profits up 58% YoY to ₹840 crore. Share of major competitor Manappuram Finance Ltd jumped to ₹159.90, up 2.53%. The gold lending industry is generally considered to be less risky and highly profitable.

  • Shares of Uflex jumped to ₹361.20, up 7.17% today. This would have helped only investors who took delivery before today, as the share had a huge gap up opening and did not show much movement intraday. The packaging materials and solutions company had reported a two-fold increase in net profits yesterday.

  • Nifty PSU Banks had an amazing day today with every bank in the index closing in green. Top gainers included Indian Overseas Bank (up 6.13%), Bank of India (up 4.84%) and Punjab National Bank (up 4.41%), among others. This jump came after leaked reports suggested that the government is keen on stake sale in 4 PSU Banks.

  • Shares of Zee Entertainment Limited (ZEEL) gained over 14% to close at ₹198.40. The media company on Tuesday had posted a 94% YoY fall in net profits for the quarter ended June 30. Despite this, strong advertising growth was seen for the company, and raising investor confidence to make it today’s top performer.

  • Shares of PVR and Inox gained today due to increased hopes of government opening cinema theatres in September. Yesterday, brokerage HSBC had recommended beaten down multiplex stocks for a rebound rally.

  • Shares of Adani Enterprises Ltd jumped 13.71% to ₹243. Today, reports came out saying that the Union Cabinet is likely to consider the Airports Authority of India’s proposal to sign a concession agreement with the company. The agreement is expected to include clauses for  public-private partnership of airports in Guwahati, Jaipur and Thiruvananthapuram.

Markets Ahead

State Bank of India’s (SBI’s) research report Ecowrap expects India’s GDP to shrink by 16.5% during Q1 FY21. This however, is better than the earlier estimate of 21% by the same report.  So conditions are bad, but they are getting better faster than expected. Markets generally tolerate bad phases, if clear signs of future growth is shown.

Nifty has sustained and closed above 11,400 today, thereby settling its foot on loose sand. The index has so far given phenomenal returns in the last 5 months and everyone in the market has been happy. Nifty was clearly in not much mood to move today, and consolidated in a specific range. Brace yourself, as tomorrow will be an eventful day with high volatility due to the weekly expiry of Nifty contracts.