Metal Stocks Lead, Banking Stocks Lag; Kotak Bank Q4 Results Miss Estimates

Today’s Action

Nifty, +0.02%; Sensex, -0.1%; Nifty Midcap, +0.3%; Nifty Smallcap, +1.1%; Model Portfolio, +3.9%

Market Pulse: Confirmed Uptrend

Distribution Day Count: One

Nifty gapped lower this morning and breached its 21- and 100-DMA. However, after hitting a low of 14,414 in the opening hour, it staged an upside reversal and gained more than 200 points. It closed above its 21- and 100-DMA. The broader market was in momentum. The advance-decline ratio was in favor of advancers. Of the 2,248 stocks traded, 1,177 advanced, 736 declined, and the rest remained unchanged. On the sectoral front, Nifty Bank (-0.8%) was the top loser. Nifty Metal (+2%) continues to outperform. Nifty FMCG also closed 1% higher. In April, FIIs sold equities worth Rs 2,655 crore, while DIIs bought shares worth Rs 476 crore.

Looking ahead, without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. Stocks that are breaking out of consolidation have higher relative strength, and superior fundamentals can do well. Continue to trim or avoid ideas lagging and/or breaking down below major moving averages.

Key News

Continue reading “Metal Stocks Lead, Banking Stocks Lag; Kotak Bank Q4 Results Miss Estimates”

Daily Big Picture:Nifty Ends Below 9,000; Pharma Index Up 45% From its Lows

Today’s Action

Nifty, -1.3%; Sensex, -1.5%; Nifty Midcap, -1.4%; Nifty Smallcap, -0.6%; Model Portfolio, +0.9%

Market Pulse Confirmed Uptrend

Nifty opened on a flat note and quickly lost around 100 points and made an intraday low of 8,912. However, it pared some of its losses and closed slightly below 9,000. Nifty escaped distribution as today’s volume was lower than the previous session. 

Barring Nifty Pharma (+2.8%) and Metal (+1.9%), all sectoral indices closed in the red. Nifty Pharma rallied ~45% from its lows. On the flip side, Nifty Realty (-4.9%), Media (-3.3%) and Financial Services (-3.1%) were the major decliners. The advance-decline ratio was in favor of advancers. Of 2,126 stocks traded, 952 advanced, 854 declined, and the remaining traded flat.

We continue to be very selective about taking any fresh positions. It is important that investors don’t play all their cards at once. We would suggest adopting an investment approach where you begin with a small allocation and increase it as and when the market advances further. 

Without trying to predict and decode stories, we will take what the market gives us and continue to monitor unfolding conditions. Stocks with higher relative strength and superior fundamentals can do well. Some leading stocks have sharply corrected. Wait for them to put in at least a short period of consolidation and show a constructive breakout from that range. Buying without this period of constructive behavior into a straight upmove off the bottom, puts you at a risk of drawdown.

Key News

According to SIAM data, passenger vehicles sales for FY20 declined 18% whereas it declined 51% y/y for March. Commercial vehicles sales declined 29% for FY20 and 88% for March.

Dr Reddys Labs. (Nse) launched the blood cancer drug Invista in India. These tablets are used for the treatment of Chronic Myeloid Leukemia.

Bandhan Bank’s total deposits grew 32% y/y to Rs 57,073 in FY20. Retail deposits grew 34% in the same period and form 78.4% of the total deposits.

Disclaimer: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. It is for educational purposes only.

Market Update: After 7 Weeks of Decline, Nifty Finally Sees Weekly Gain

Weekly Action

Nifty, +12.7%; Sensex, +12.9%; Nifty Midcap, +10.9%; Nifty Smallcap, +9.6%; Model Portfolio, +2.1%.

Market Pulse Confirmed Uptrend

Weekly Market Review

Nifty made a halt to seven straight weeks of decline and closed the week with a gain of more than 12%. The index started the week on a strong positive note and recorded additional follow through day as it gained about 8.8%, on higher volume than the previous session. The index closed in negative on Wednesday. Today, Nifty staged a reversal and closed the day near the day’s high holding significant gains.

All the sectoral indices closed in positive territory for the week. Nifty Auto (+23.1%) led the gains followed by Nifty Pharma (+19.4%) which continued the gaining momentum. Further, Financial stocks staged a reversal with Nifty Pvt Bank, Nifty Bank, and Nifty Financial gaining more than 14% each.

We continue to be very selective about taking any fresh positions. It is important that investors don’t play all their cards at once. We would suggest adopting an investment approach where you begin with a small allocation and increase it as and when the market advances further. Without trying to predict and decode stories, we will take what the market gives us and continue to monitor unfolding conditions. Stocks with higher relative strength and superior fundamentals can do well. Some leading stocks have sharply corrected. Wait for them to put in at least a short period of consolidation and show a constructive breakout from that range. Buying without this period of constructive behavior into a straight upmove off the bottom puts you at the risk of a drawdown.

Disclaimer: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. It is for educational purposes only.