Market Round-UP: Bears Refuse To Loosen Their Grip

The Indian markets saw yet another day of fall, the fourth day in a row. The Nifty opened flat only to slide down. It did try to gain in the afternoon session but couldn’t sustain it and finally fell to close 111 (-0.65%) points down at 17043.3. Nifty continues to trade below 200 DMA.

On the other hand, Bank Nifty also mimicked nifty in its fall and recovery but remained flat in the second half of the session. Bank Nifty although trading below 200 DMA, it is trying hard to defend itself.

The advances in Nifty stocks were 754 while the declines were 1548 and 96 stocks remained unchanged. This was slightly better than yesterday’s advances and declines.

IndiaVix at 16.22 is still positive but it has taken a pause and had remained flat for the most part of the session, unlike yesterday’s climb. Will this be a lull before a storm is a question that probably has no answer.

FIIs were net sellers today and sold Rs. 3087 crore in the cash market. On the other hand, DIIS were net buyers at Rs. 2122 crores.

Sector

The bears made their presence felt across sectors. Excepting Nifty media, Nifty pharma and Nifty quality 30 the rest of the indices were in the red. Nifty PSU banks Nifty IT and Nifty Alpha 50 were deep in the red as each of them slid 1.9%, 1.65%, and 1.38% respectively. Significantly, Nifty pharma is trading below its 2-year low.

Stocks

There was more bearish news in stocks than bullish ones. Cipla was down over 2% as income tax officials conducted surveys due to tax violations due to wrongful R&D deductions. However, the stock recovered and closed marginally down at 0.35%.

Adani group stocks were battered today. The Adani group stocks fell up to 7% with four of the group companies hitting lower circuits. Adani stocks came to the limelight due to heated discussions in the parliament post-Hindenburg report. The Finance Ministry told the Lok Sabha that the volatility in Adani stocks had no significant impact at the systemic level.

Only 11 stocks that included, BPCL, Titan, Bharti Airtel, and LT amongst others were in green the rest were in red. PSU banks were hammered as all of the PSU banks ended in the red. The most impacted were Indian Bank (-8.46%), Bank of India (-5.85%), and Union Bank (-4.4%).

Open interest

More bearish positions were added. The open interest data continues to paint red as more calls were added taking the total open position to 13.75 crore shares as compared to 12.16 crore shares. There was an addition to the puts as well. The total puts were seen at 6.86 crore shares as compared to 6.10 crore shares. More calls are added than puts indicating persistent bearish sentiment. The put-call ratio remained at 0.50.

Local

India’s February Wholesale Price Index (WPI) came in at 3.85% vs. 4.73% YoY. The numbers were lower than the street estimate of 4%.

Global

Credit Suisse finds that there were ‘material weaknesses” in its internal control over financial reporting. The stock lost 14 per cent in yesterday’s trades hitting fresh new lows. It lost almost 5% in today’s trade till now.

The global financial turmoil seems to be springing up surprises and the volatility in the financial sector is expected to continue.

The US is awaiting core inflation and CPI data today evening. Any sticky inflation data will be watched keenly by the street as it may increase the probability of an increase in interest rates.

The bears have a firm grip

Today also the bears had an upper hand. The volatile financial market sticky inflation and rate hike fears all have made the market volatile and the bears are making the most of it.