Share Market Highlights- Nifty settles below 19550, Sensex below 65400; Midcaps stocks fall

“The benchmark Nifty recently experienced a significant decline, falling below the 50-day moving average (50DMA). The current trend appears to be negative, with immediate support situated at 19,500. A further decline below this level could potentially lead the index towards the range of 19,150 to 19,000. On the upside, the zone between 19,600 and 19,650 is expected to act as a strong resistance. A move above 19,650 could trigger short covering in the market,” said Rupak De, Senior Technical analyst at LKP Securities.

“In the financial year results, TCS, Infosys, and HCL Tech are strategically pivoting towards aggressive cost rationalization, demonstrating remarkable margin improvements. The unexpected positive margin performance reflects their proactive measures, such as elevating utilization rates, enhancing productivity, and reducing the average cost of resources. This suggests that these companies have the potential to expand margins by 60-110 basis points over the medium term, showcasing their adaptability and resilience in response to evolving market dynamics,” said Sumit Pokharna, Vice President and Analyst at Kotak Securities.

(Source: NSE)

“The share price of Titagarh Rail Systems soared 5.38% to Rs 838 during the intra-day trade on Friday. The surge came after the company inked a contract with Gujarat Metro Rail Corporation (GMRC) for Rs 350 crores for the Ahmedabad Metro Rail Phase-II Project.”

“TVS Motor Company, a leading manufacturer of two-wheeler and three-wheelers globally, announces its momentous entry into the Venezuelan market today. This makes TVS Motor the first Indian automobile manufacturer to enter the market with a host of 14 SKUs for the enthusiastic riders of Venezuela, with their local distributor,” said the company in a press release.

SoftBank’s venture capital fund SVF Growth, Singapore, will sell a 1.1% stake in Indian food delivery firm Zomato for Rs 1024 crore ($123.24 million), CNBC TV-18 reported on Thursday, citing sources.

(Source: NSE)

“WTI Crude oil futures extended gains for the second straight day and is poised for the second consecutive weekly gain as heightened geo-political tensions raise supply concerns. There have been drone attacks against US bases in Iraq and Syria, while an American destroyer in the Red Sea intercepted cruise missiles fired toward Israel by Houthi rebels in Yemen raising concerns that the conflict might escalate to a US-Iran confrontation. Meanwhile, the US is aiming to buy as much as 6 million barrels of sour crude for delivery to the strategic petroleum reserve in December and January. We expect oil prices to remain buoyed amid higher risk premium,” Ravindra Rao, CMT, EPAT, VP-Head Commodity Research, Kotak Securities.

The share price of ITC plunged 2.01% to Rs 441.35 following the company’s Q2FY24 results. The company on Thursday reported a 6.11% rise in consolidated net profit to Rs 4,955.90 crore for the second quarter of FY24. 

“Nifty weekly contract has highest open interest at 19,650 for Calls and 19,600 for Puts while monthly contracts have highest open interest at 19,800 for Calls and 19,500 for Puts. Highest new OI addition was seen at 19,650 for Calls and 19600 for Puts in weekly and at 19,600 for Calls and 18,000 for Puts in monthly contracts. FIIs increased their future index long position holdings by 4.93%, decreased future index shorts by 3.36% and increased index options by 30.55% in Call longs, 4.35% in Call short, 0.43% in Put longs and decreased 24.54% in Put shorts,” said Anand James, Chief Market Strategist at Geojit Financial Services.

The NSE Nifty 50 opened at 19,542.15 down 0.42%, the BSE Sensex opened at 65,437.07 down 192.17 points.

“The US 10-year yield hovering around 5% continues to be a headwind for equity markets. The volatile situation in West Asia, though being largely ignored by the market now, can pose additional near-term challenges. FPIs are likely to remain sellers putting pressure on banking stocks which constitute the major share of their AUM. This provides an opportunity for domestic investors to buy these stocks which are available at fair valuations. Latest data shows that India’s food grain production is at record high and this can keep food inflation under control. The implication is that the MPC will go for a long pause and this is favourable for banking stocks,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

“On Thursday, spot gold closed with a gain of 1.34% at $1973.70 as traders construed Federal Reserve Chair Powell’s speech at the Economic Club of New York largely as dovish. Japan’s national CPI inflation data eased to 3% in September Vs 3.20% in August. Today’s data calendar includes the UK’s Gfk consumer confidence and retail sales. Situation on middle East conflict front remains turbulent as Israel sticks to its ground invasion plan. Gold is expected to hit $2000 mark on the US ten-year bond yields may stall at 5% briefly at least. Support is at $1965/$1945,” said Praveen Singh – Associate VP, Fundamental Currencies and Commodities, Sharekhan by BNP Paribas.

“There are signs of positive divergence developing on the daily momentum indicator as a new low in prices was not accompanied by a new low on the momentum indicator which indicates momentum on the downside is weakening and the probability of a pullback is high. We expect the Bank Nifty to witness a pullback towards 44,000 – 44,400 from short-term perspective,” said Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas.

“Nifty faces vulnerability due to rising Middle-East tensions and soaring oil prices. Despite this, Nifty Bulls may attempt a recovery, with key support at 19,507. The preferred Nifty trade is to buy on dips in the 19,500-19,525 range, with targets at 19,707 and aggressive targets at 19,889. Bank Nifty offers a similar strategy in the 43,300-43,350 range, with targets at 44,100 and 44,551. The Fed is expected to proceed cautiously regarding rate hikes. Nifty’s technical outlook suggests strength above 19,757, while options data indicates a trading range of 19,300-20,000,” said Prashanth Tapse, Senior VP (Research), Mehta Equities.

On Thursday, the 10-year US Treasury yields reached a 16-year high after US Federal Reserve Chairman Jerome Powell said that additional interest rate hikes could be warranted in view of economic resiliency and labor market tightness, reported Reuters.

The NSE has added Balrampur Chini Mills, Indiabulls Housing Finance, India Cements, Delta Corp, GNFC, Manappuram Finance, and MCX India to its F&O ban list for October 20, 2023.

ITC, Hindustan Unilever, Grasim Industries, Tata Motors, Natco Pharma and Cyient are among the top stocks to watch during Fridays’ trading session.

WTI crude prices are trading at $90.35, up 1.1%, while Brent crude prices are trading at $93.13, up 0.81%, on Friday morning.

Wall Street’s major indexes ended lower on Thursday. The tech-heavy Nasdaq Composite tanked 128.13 points, or 0.96%, to 13,186.18. The S&P 500 fell 36.61 points, or 0.85%, to 4,277.99, while the Dow Jones Industrial Average dropped 251.04 points, or 0.75%, to 33,414.04.