Bulls Vs Bears
Indian equity slipped in early trades before recovering at the close. The bulls came back valiantly after the Nifty slipped 272 points down and at the close Nifty was 112 points in the red while the Bank Nifty closed 236 points down. The 16800-17000 level is being fiercely defended by the bulls. The Bank Nifty also defended the 39000 level and came back from a low of 38942.
European markets while writing this report are trading although flat is trading in green. The Dow futures also recovered from their low and is now trading 60 points in the red.
The Nifty advance decline leaned more towards the declines. Only 675 stocks advanced while 1644 stocks declined and 79 remained unchanged. This is a cause for worry.
IndiaVix closed higher at 16.02 as compared to Friday’s close of 14.77. This is also worrisome. Any further increase may cause the market to break the fragile support levels.
FIIs were net sellers today and sold Rs. 2546 crore in the cash market. On the other hand, DIIS were net buyers at Rs. 2877 crore.
Stocks
The top gainers in the Nifty 50 included HUL (+2.61%) followed by BPCL (+2.35%), and ITC (0.57%). The top loser in Nifty 50 included were Bajaj Finserve (-4.33%) followed by Adani Enterprises (-3.82%), Bajaj Finance (-3.17%) and Hindalco (-2.76%).
On the corporate news flow side, sources say that HDFC Bank may get some relief from the Reserve Bank of India concerning priority sector lending. Banks have to give 40 per cent of the loan books to priority lending. HDFC Bank may get more time to comply with the same. HDFC Bank closed 0.69 per cent down. Positive read-through.
Bangalore-based real estate company Sobha’s premises have been raided by the Income-tax sleuths for tax evasion. The raids also covered the premises of the top officials of the company. The stock closed 2.82 per cent in the red. Negative for the stock.
There was a change in hands of the share of HDFC AMC. Multiple block trades worth Rs.807.15 crore were executed for 50.45 lakh shares at Rs.1600. HDFC AMC closed Rs.1680 up by 0.12 per cent.
Cochin Shipyard jumped 6.5 per cent on an order win of Rs.550 crore from Samskip group.
Sector
On the sector performance today only FMCG emerged positive. The rest of the sector indices were either flat or in the red. The key contributors to the FMCG were HUL, Jubilant Food Wors and Godrej Consumer.
Open Interest
There was some open interest (OI) unwinding in the 17000 strike puts. The Put unwinding is a worry as bulls are facing pressure. Calls were added to the 17000 strikes. A Fresh OI of 1.3 crores was added while 0.57 crore was added to the puts.
Bulls under pressure
The bulls are feeling the heat with today’s fall. Although the last-hour pullback was encouraging, it may be due to intraday short covering. The OI data suggests that the support of 17000 is beginning.
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