Daily Big Picture – Key Indices Extend Slide Amidst Negative Global Cues


Today’s Action:

The benchmark indices opened flat with a positive bias in today’s trade; however, the market gradually lost ground, sliding into losses once the European markets opened in red.


Daily Market Review

After yesterday’s weak session, the key benchmark indices opened on a positive note in the morning; however, the indices failed to build on initial gains, and finally closed in red. The market sentiment was subdued due to lacklustre performance across the Asian markets, and the lack of any major domestic cues. The indices began to slide, once the European markets opened in red.

The Nifty opened higher today, at 9,520.20, and touched an intraday high of 9,522.50. However, the index slipped in the afternoon trade, reaching an intraday low of 9,474.35, before closing at 9,491.25, down 0.21% from yesterday’s closing price. The BSE Sensex, after opening higher at 30,988.87, hit an intraday high of 31,000.48. Tracking the Nifty, the Sensex slipped in the afternoon trade, reaching an intraday low of 30,798.70, before finally closing at 30,834.32, down 132.93 points or 0.40% from yesterday’s close.

The breadth, indicating the overall health of the market, was weak. A total of 1,277 stocks advanced on the BSE, while 1,330 stocks declined and 182 were unchanged.

Even as the headline indices closed lower, the broader markets posted gains for the day. The Nifty Midcap and the Smallcap indices added 0.39% and 0.45%, respectively, in today’s trading session.

The MarketSmith India IND 47 Index, which lists the top 47 stocks in chart on fundamental characteristics, gained 0.31% in today’s trading session.

Among the sectoral indices, gainers outnumbered losers, with seven sectors advancing and five sectors declining. Among the gainers, the Nifty Metal, Realty, and IT indices topped the charts, with gains of 1.62%, 0.79%, and 0.64%, respectively. On the downside, Nifty Energy, Nifty FMCG, and Nifty Media posted losses of 1.14%, 0.79%, and 0.76%, respectively.

In a move that can shake up the coal mining and power sectors in the country, NITI Aayog has proposed breaking up Coal India into seven firms. The government think-tank has also called for reforms in allocating coal blocks to independent companies with expertise in coal mining, as the government seeks to boost coal production locally. The state-owned Coal India is often criticized for its inefficiency; its output-per-man-shift is estimated at one-eighth of Peabody Energy, the largest coal miner.

In the banking sector, the country’s largest lender, SBI, has referred three of the 12 NPAs identified by the banking regulator, to the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code. Meanwhile, Fitch Ratings has maintained its negative outlook on Indian banks, and has affirmed the long-term issuer default ratings of eight Indian banks at BBB-. The rating agency also downgraded Bank of India’s viability rating from bb- to b+, reflecting the bank’s weaker intrinsic risk profile, compared with higher-rated peers.

Today, the Union cabinet will likely decide on the hike in the HRA and other allowances under the seventh pay commission, for nearly one crore central government employees and pensioners.

Trading volumes in both the Nifty and the Sensex were lower today, thereby escaping a distribution day. Today, both the Nifty and the Sensex shed a distribution day due to ageing, and the new distribution day count for both the indices stands at 2.0. The Indian market remains in a Confirmed Uptrend.

Current Outlook:

– Market environment conducive for new purchases, but remain selective.

– Focus on fundamentally strong stocks breaking out of strong technical patterns.

– Stay disciplined and exercise sound buy and sell rules.

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