Daily Big Picture : Sharp Sell-Off Drags Nifty Below 11,200; Tata Chemical’s Consumer Business to Merge with Tata Global Beverages

Today’s Action

Nifty, -0.6%; Sensex, -0.6%; Model Portfolio, -0.1%; Nifty Midcap, -0.7%; Smallcap, -1.2%; MSI IND47, +0.2%.

Daily Market Review

Market Status: Uptrend Under Pressure 

Benchmark indices, after snapping a nine consecutive day losing streak yesterday, ended lower today. The market wiped out gains in the last hour of trade with all the sectors witnessing selling pressure except IT and Realty. In the broader market, the Midcap and Smallcap declined 0.7% and 1.2%, respectively.

Yes Bank (-8.3%) was the top loser today after the RBI appointed R Gandhi (former deputy RBI Governor), as Additional Director on the board of the bank for a period of two years. Among others, Tata Motors (-8.2%) and Zee Entertainment Ents. (-6.9%) followed the suit.

The advance-decline ratio was in favor of losers. Of the 2,102 stocks traded on the NSE, 659 advanced, 1,084 declined, and 359 remained unchanged.

Considering the Nifty breaching its 50-DMA and increasing distribution, we downgraded the market to an Uptrend Under Pressure last Wednesday. We’ll further downgrade the market if the distribution day count increases to more than 5-6 or if the Nifty breaches 200-DMA (11,035).

Key News

Dalmia Bharat: The Company reported its Q4 FY19 results. Revenue grew 8% y/y aided by volume growth of 8%. However, volume growth of 8% was way below the Q4 FY18 volume growth of 14%. The realization grew 1% y/y on the back of price hike in South. Management has highlighted that sluggish volume growth was mainly on account of the lack of available clinker capacity. Today, the stock closed 3.2% lower.

Tata Global Beverages: The consumer product business of Tata Chemical will be transferred to Tata Global Beverages, as part of Tata Son’s group restructuring plan. The proposed plan was initiated with the objectives of revenue acceleration and cost synergies. The stock was down 0.5% today.

Leaders Up on Volume: Srf (+6.1%), Bajaj Finance (+4.2%), and Vinati Organics (+4.0%),

Leaders Down on Volume: Aditya Fash.& Retail (-8.3%), Newgen Software Techs (-2.9%), and Torrent Pharmaceuticals (-1.1%).

What do you think? Please email us any questions or comments.

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