Today’s Market Summarised

Nifty opened with a gap-down at 15,081 and was volatile through the first many hours of the day. Between 11:30 am and 1:30 pm, Nifty traded in a 60-point range around yesterday’s low as an indication of a big movement. Just after 2 pm, the index broke its opening range and fell sharply with almost every index falling in this time. A day low was created near 14,900 and the index quickly rebounded back up nearly 100 points to 15,000 levels. Nifty closed just below 15k at 14,981.75, down 137.20 points (0.91%).

Bank Nifty opened the day with a gap-down at 36,395 and was volatile just like Nifty. It consolidated around yesterday’s low for more than an hour and fell sharply as profit booking continued. The index tried to move back up but 36,000 acted as a resistance. Bank Nifty closed at 35,841, down 745 points or 2.04%.

Every sectoral index closed in the red today with Nifty PSU Bank falling nearly 5%. Auto and finance stocks fell sharply. IT and FMCG stocks fell the least.

European markets are trading mixed at the time of our markets close. Asian markets are also trading mixed for the day.

News Picks

Shares of IndusInd Bank stayed strong even as Bank Nifty fell over the day. This happened as the bank confirmed yesterday that promoters had completed over Rs 2,000 crores capital injection to the bank via conversion of warrants.

Shares of GAIL went up to close at Rs 145 as buyback was confirmed opening next Wednesday. Buyback is for 6.97 crore shares at a rate of Rs 150/share.

Shares of IDFC First Bank closed 7.4% up in the day as the bank approved raising Rs 3,000 crore through the equity route. The management also said that the fund will be used for the future growth of the bank, as they see great potential. It had gone up nearly 12% intraday.

Shares of Dr Reddy’s jumped in the day as the company announced they had initiated the process for receiving emergency approval for their Covid vaccine, Sputnik-V.

Shares of DLF moved as Swedish retail giant Ikea signed a deal with the company for a 48,000 sq. feet project in Noida. Also at a good level of Rs 300 and can be watched if it takes support on Monday.

Reliance tried to sustain above the 2,100 range but failed yet again. Even with just a 0.5% gain, it was Nifty’s biggest contributor giving 9 points to the index.

Many outperforming shares from last week fell sharply in the day. Adani Enterprises fell nearly 10% intraday between 1 and 2 pm. SBI fell, Tata Motors fell again and many many more. Is this a sign of caution, that profits are being booked now that markets have peaked?

Shares of General Insurance Corporation of India closed 20% up just like yesterday. New India Assurance Company closed nearly 13% up. Yesterday there were rumours of privatisation of the two government-owned companies.

Shares of Marico jumped nearly 2% as the company launched instant noodles under ‘Saffola Oodles’ brand to compete with Nestle’s Maggi and ITC’s Yippee. Not a fan of the name.

Markets Ahead

Nifty closed the week with losses after touching fresh all-time highs. This reminds me of 2 weeks ago when the same happened. A sharp correction, even sharper than today, was seen after Nifty hit a high then. We all know how fast the bounce-back was.

Nifty closing below 15,000 and Bank Nifty closing below 36,000 is significant. Nifty has not closed below 15,000 even once after it jumped over the level on Feb 8th. But Bank Nifty is just at last weeks levels.

Money flowing into IT stocks may continue over the next day, as overperforming sectors face correction. 

Midcaps and smallcaps indices fell as well indicating that the fall is not part of any consolidation. 

Global markets continuing to be in green means that there is still hope that it is not a big fall. Also, Bitcoin has jumped and nearly touched $1 Trillion in market cap beating gains of all listed securities around the world.

Nifty would have to close above 15,100 and Bank Nifty above 36,300 to say that the indices have not become bearish.

Only Nifty Metal and Nifty PSU Bank closed with gains for the week. Also, Smallcaps and Midcaps indices were net positive this week!

Was joking to my friends about how I would give Nifty a salute if it closes above 15k. The ‘official’ or weighted average close is below 15,000, but the last traded price of the index is above it!

Catch you all on The Stock Market Show tonight!