PremiumNEW DELHI : All sectoral indices remained in the green after lagging in early trade. Auto stocks moved into the green as companies reported monthly sales data through the day. IndusInd Bank, Hindalco, Bharti Airtel, HCL Tech and Grasim were top gainers on Nifty, while IndusInd Bank, HCL Tech, Bharti Airtel, Tata Steel and Tech Mahindra were among top gainers on Sensex.
Nifty opened at 17,783.15 to close at 17,929.65, up 258 points, or 1.46%, on Monday. The index touched a high of 17,954.10 and low of 17,697.10 intraday. Sensex which closed at 59,306.93 on Friday opened at 59,577.48 on Monday and closed at 60,138.46, up 831.53 points, or 1.40%. The index touched intraday high of 60,220.21 and low of 59,355.12. Realty, metals and IT were among the top gaining sectors. Energy and auto were among top drags. Auto sector, however, rally from negative in early trade into positive territory as monthly sales figures trickled in. Banking stocks made a rally towards the end of the day, along with telecom. IndusInd Bank, Hindalco, Bharti Airtel, HCL Tech and Grasim were top gainers on Nifty, while IndusInd Bank, HCL Tech, Bharti Airtel, Tata Steel and Tech Mahindra were among top gainers on Sensex.
The Nifty has risen smartly to get past the 17,900 level. If we can keep above this level for a couple of trading sessions, the uptrend should resume and take the index higher. On the downside, 17,550-17,600 has become a good support for the markets and until that does not break on a closing basis, it is safe to assume that the trend continues to remain on the upside.
IOC has said the project with capital expenditure of ₹36.81B will be commissioned in 54 months from stage-1 investment approval, according to a Reuters report
IndusInd Bank, Bharti Airtel, HCL Tech, Tata Steel are among top gainers. Nestle India, M&M, and Bajaj Financial Services are the losers on Sensex.
Indian markets opened on a positive note following largely positive Asian markets as investors react to mixed China factory activity data for October. during the afternoon session, markets continued to trade in positive terrain due to buying in realty, telecom and metals sector. Buying in front line stocks also pushed the key indices higher. Sentiments were upbeat as a monthly survey said that India's manufacturing sector activities gained further strength in October as companies scaled up production and stepped up input purchasing in anticipation of further improvements in demand. Also the GST data released today posted second highest ever GST collection of ₹1.3 trillion, a growth of 24% year-on-year which further boosted the sentiments.
Nifty midcap 50 is seeing rally from stocks such as Mindtree in the closing hour.
Both Sensex and Nifty have expanded gains over 1% as of 2:22 pm.
Hinduja Group flagship firm Ashok Leyland on Monday reported an 11% growth in total commercial vehicles sales at 11,079 units in October. The company had sold a total of 9,989 units in the same month last year, Ashok Leyland said in a regulatory filing. Total domestic sales were at 10,043 units as compared with 8,885 units in the corresponding month last year, a growth of 13%, it added. Domestic sales of medium and heavy commercial vehicles were at 5,254 units as against 3,881 units in October 2020, a growth of 35%, the company said. (PTI)
Indian Railway Finance Corporation's Q2 SL net profit was ₹15 billion compared with ₹9.95 billion year-on-year; the firm's revenue of ₹47 billion beat its revenue of ₹37.13 billion year-on-year.
Indian Railway Catering and Tourism Corporation's September quarter revenue was ₹4.04 billion compared with ₹1.08 billion year-on-year. The company's net profit (SL) of ₹1.6 billion compared with ₹326 million year-on-year; It was ₹825 million last the last quarter. IRCTC's profits beat analysts' estimate of ₹1.4 billion.
Graphite India Ltd has reported net profit of ₹1.28 billion compared with a loss of ₹410 million in year-ago period. The company's consolidated revenue from operations was ₹6.92 billion compared with ₹4.85 billion in year-ago period.
Skoda Auto India today announced a 116% increase in October 2021 sales, compared to the same period last year. The company sold 3065 cars in October 2021, compared to 1421 cars sold in October 2020. It is still riding on the success of the Kushaq which has received 15000 bookings so far. The numbers have been on the rise for the Superb, Octavia and Rapid too, all of which have contributed to the increasing sales volumes.
Sensex and Nifty have remained in the green through the day till this time powered by gains across the broader markets. Realty, metals, and IT have powered the markets.
Bandhan Bank said on Monday that it has been empanelled by the Reserve Bank of India (RBI) to act as an agency bank to facilitate transactions related to government businesses. The RBI's decision will help Bandhan Bank in contributing to nation-building, its MD and CEO Chandra Sekhar Ghosh said. The announcement comes months after a RBI guideline that authorised scheduled private sector banks as agency banks of the regulator for the conduct of government business. With this, Bandhan Bank joins ranks with a few other scheduled private sector banks to be empanelled as agency banks of the RBI, the bank said in a statement. As an agency bank, Bandhan Bank will be able to handle transactions related to collection of state taxes, and revenue receipts such as GST and VAT, collection of stamp duty, and pension payments on behalf of central and state governments, it added. (PTI)
Automaker Nissan India on Monday said its domestic wholesales rose over three-fold to 3,913 units in October, up from 1,105 units in the same month of last year. The company said its exports last month stood at 3,004 units, compared with 75 units in October 2020. "The first seven months cumulative sales are higher than the cumulative sales of the last full financial year in spite of the challenges of COVID-19 and semiconductor shortages affecting supplies. (PTI)
Maruti Suzuki India reported total sales of 138,000 units in October, a fall compared with 182,000 units year-on-year; however, the sales was up from 86,380 units month-on-month. October sales also beat analysts' estimates of 117,000 units.
Ashok Leyland has reported total sales of 11,079 units, compared with 9,989 units in October year-on-year; it is also an increase from 9,533 units month-on-month. The street had estimated sale of 9,100 units.
Bullion outlook
· Comex gold prices declined 0.98% on the back of a stronger dollar. However, concerns over rising inflationary pressures, US China geopolitical tensions and rise in covid cases have offset the downside pressure on gold
· The dollar index surged by 0.84% on Friday, making bullion more expensive for holders of other currencies
· The consumer spending data from US fuelled worries on aggressive monetary policy action from the Fed to combat a surge in prices
Energy outlook
· US crude prices settled higher on Friday supported by expectations that Opec, Russia and their allies would maintain production cuts
· US natural gas futures declined 3% on Friday after Russian President Vladimir Putin said Russia could start pumping gas into European storage
· According to the Baker Hughes report released on Friday, US oil rigs increased by one to 444 this week while gas rigs also gained by one to 100, the highest since mid-September
Recommendations
1) Crude Oil
2) Silver Mini
Sensex and Nifty have regained some of the lost ground in early trading.
Indian markets have been one of the best performing markets this calendar year and are up 25% YTD CY21. They have deftly climbed the wall of worry be it the second covid wave in the country in April-May 2021 or the third wave expectations during August-September 2021. This was due to a confluence of fundamental factors: First and foremost, equity as an asset class is being widely and rightly recognized as an asset generating inflation beating returns or real returns over a long period of time and is indeed very much liquid in nature; the TINA (there is no alternative) factor is at play. Secondly, with the increase in pace of digitization, a set of efficiencies have crept into organizations as well as the economy, indicating better corporate earnings/GDP growth. Thirdly, with new age technology platforms, the reach of equities has increased with record number of demat accounts being opened over the last 18 months, indicating enhanced retail participation.
Apart from these fundamental drivers, some qualitative and macros, which make us incrementally positive on the markets include a) higher pace of vaccination, b) pro growth policy action, c) National Asset monetization pipeline that will drive capex cycle, d) Strong recovery in real estate market that a has multiplier impact on the economy and e) Buoyancy in Corporate earnings growth (Nifty EPS CAGR of 26% over FY21-23E).
Given the scenario, we see value emerging across the market cap spectrum with the key filter being quality. We continue to advise investors to utilize equities as a key asset class for long term wealth generation by investing into quality companies with strong earnings growth and visibility, stable cash flows, RoE and RoCE.
We recommend Bank of Baroda, Action Construction Equipment, Bata India, TCNS Clothing, Gateway Distriparks, Mahindra Lifespace and Vardhman Special Steel as our Muhurat 2021 picks.
Capital Small Finance Bank has filed draft red herring prospectus (DRHP) for an initial public offering. The IPO will comprise a fresh issue of shares for ₹4.5 billion, and an offer for sale of 3.8 million shares, according to the DRHP. Edelweiss Financial Services, Axis Capital, SBI Capital Markets are book running managers of the IPO, the draft papers said.
Lux Industries has reported consolidated net profit of ₹1 billion in the September quarter compared with ₹672.3 million in the year-ago period. The consolidated net sale of products was ₹6.20 billion in the September quarter, compared with ₹4.99 billion in the year-ago period. The company's board has declared an interim dividend of ₹12 per share.
Oil pared an early decline as OPEC+ may resist mounting pressure this week to boost production at a faster clip, and traders looked beyond China’s release of fuel reserves to quell shortages. Global benchmark Brent was 0.3% weaker after recouping more than half its intraday loss. Speaking after a Group of 20 summit in Rome Sunday, President Joe Biden criticized Saudi Arabia and Russia for their inadequate response to managing supply, while declining to say what he planned to do if producers didn’t respond. Key time-spreads pointed to a tight global crude market. Earlier in the weekend, China said it would release reserves of the two transport fuels to combat shortages, according to the National Food and Strategic Reserves Administration. The move is a part of an annual rotation of holdings, but the state body gave neither volumes nor a schedule. (Bloomberg)
The Competition Commission of India (CCI) issued a final order on 29th October 2021 against six firms that were found to have indulged in cartelization in the supply of Low-Density Poly Ethylene covers (LDPE) to Food Corporation of India (FCI) by means of directly or indirectly determining prices, allocating tenders, coordinating bid prices and manipulating the bidding process.
(Read here)
Nifty volatility index was up 2.56%.
Only one realty stock was in the red on BSE Realty.
Manufacturing sector growth in India gained steam in October as companies scaled up production in line with a substantial upturn in new work intakes, according to IHS Markit India Manufacturing Purchasing Managers’ Index. Firms stepped up input purchasing amid stock-building efforts and in anticipation of further improvements in demand, while business optimism hit a six-month high. (Read here)
Top gainers and losers in the gain/loss band of 2-5%
Tata Motors has posted 26 per cent decline in the two wheeler category with domestic sales coming to 198,738 in October 21 as compared to 268,631 vehicles sold last year during the same period. The exports figure also seen a 5 per cent decline with the numbers touching to 192,565 as compared to the 201,659 two wheelers being exported last year. (Read here)
Sigachi Industries Ltd initial public offering (IPO) has opened on Monday, November 1 for subscription and will conclude on 3 November, along with two other issues of Policybazaar and SJS Enterprises. The company has set price band of ₹161-163 a share for its three-day share sale. (Read here)
SAIL showed change of over 12% at 10:05 am.
The market is trading very close to its support of 17,550-17,600. If we break this zone, we could slide down to 17,200. In order to move up, we would need to get past 17,900 on a closing basis. Until then it is advisable to wait for either side to be taken out before trades are placed.
Commercial cylinders of 19 kg to COST ₹2,000.50 in Delhi from Monday. It cost ₹1,734 earlier. No increase in domestic LPG cylinders.
Most sectoral indices on Nifty have registered gains.
Bajaj Auto has reported October total sales of 439,615 units compared with 512,039 units year-on-year; However, it was an increase from 402,021 units month-on-month. The street had estimated 436,600 units.
Nifty is expected to open flat to positive at 17,700 , up by 30 points. Nifty has support at 17,600 and 17,450 levels and resistance at 17,950 and 18,050 levels. Traders are suggested to avoid long positions till the time Nifty trades above 18,350.
The global set up was just ideal for our markets to have a head-start on Monday and in fact we over surpassed what SGX Nifty was indicating as well. However markets did not sustain at higher levels and had a slight weak close. This was followed by some recovery in the following two sessions; but overall the momentum was clearly lacking. The expiry session of the October series turned out to be a nightmare for the bulls as we witnessed a massive sell off across the board throughout the session to break all important levels one after another. Nifty eventually plunged below 17,900 to conclude the October expiry on a depressive note. In this process, Nifty ended with nearly 2% loss, thereby marking a biggest single day cut after April 12, 2021. The bears were not done with this as we witnessed a follow through selling of this to test the 17,600 mark.
Due to this week’s correction, the bears have finally managed to apply brakes on the ongoing euphoria. We can see weakest weekly performance after nearly 8 months as Nifty shed more than 2% to conclude the October month convincingly below 17,700. Since last week or so, Nifty started to look a bit nervous but banking was providing a strong helping hand and hence we did not see any major damage in benchmark. But now, the financial space finally succumbed to the broader market weakness by tumbling over 3%. This imposed tremendous pressure on Nifty and in the process, Nifty had to finally surrender the sheet anchor support of 18,000. In fact, due to aggrandized selling, it just hastened towards the next key support of 17,600. Since last few days, we have been maintaining our cautious stance on the market and even though market was making new highs, we maintained our scepticism and repeatedly advised booking profits. When market was not correcting, this might have sounded senseless, but historically its proven, when things look hunky-dory all around, the euphoric situation takes place and that is the time when market strikes back. This is exactly what we witnessed in last couple of weeks.
Technically speaking, due to this late dominance from bears, we can observe few important developments on charts. Firstly, the ‘Lower Top Lower Bottom’ on daily chart after breaking below 18000, which coincided with the violation of the key short term moving average of ’20-day EMA’. More importantly, if we take a glance at the monthly chart, we can see a formation of ‘Shooting Star’ pattern, which certainly does not bode well for the bulls. Going ahead, since the market is a bit oversold, we may see some relief move in between; but traders should not get carried away by such rebounds. On the higher side, 18,000–18,100 would now be seen as immediate hurdles and any bounce back towards it, should be used to lighten up longs. On the flipside, we may see this corrective move extending towards 17,450 first and if things worsened then the possibility of sliding towards 17,200–17,000 cannot be ruled out. We reiterate on staying light and avoiding any kind of bottom fishing for a while.
PB Fintech, which operates online insurance platform Policybazaar and credit comparison portal Paisabazaar, initial public offering (IPO) will open for subscription today. The three-day share sale's fixed a price band of ₹940-980 and the issue will conclude on November 3. The company on Friday said it garnered a little over ₹2,569 crore from anchor investors ahead of its IPO. (Read here)
October series was completely a roller coaster for our markets as we can easily divide it into two halves. First one being the excellent where bulls continued their dominance to mark a fresh record high of 18,604.45 but unfortunately the latter half was not that pleasant at all, especially last two sessions of the monthly expiry. Finally, we concluded the volatile series tad below 17,900. Now let’s take a quick glance at the F&O activities. We noticed good amount of longs during first week of the series but as we marched beyond 18,000; longs were clearly missing. During the latter half, we witnessed decent profit booking along with short formation especially in last couple of sessions. Looking at open interest activity MoM, it seems most of the longs have been lightened up and few shorts have been carried to the next series. Rollover for Nifty and BankNifty stood at 82.31% and 80.37%, respectively. Meanwhile, stronger hands also preferred staying light in index futures and rolled-over shorts in stock futures segment. In equities, they were net sellers to the tune of ₹20,429 crores till date. As far as option activity is concerned, traders are now eyeing 17,500 put and 18,000 call options. Considering the above data points, we would maintain our cautious stance on market and would advise traders utilizing any bounce back in the vicinity of 18,000 to add fresh shorts.
AirAsia X Bhd.’s shares dived by the most in more than a year after the long haul budget airline was officially categorized as a financially distressed firm, which gives the company a year to recast its finances or risk losing its Malaysian listing. The stock tumbled as much as 21.1% to 7.5 sen on Monday, set for the steepest drop since August 2020. The shares traded at 8 sen at 10:40 a.m. local time amid volume that was six times the average for this time of day. (Bloomberg)
The Federal Reserve won’t be the only one announcing a taper on Wednesday. The Treasury Department, for the first time in more than five years, will likely unveil a scaling down of its behemoth quarterly sale of longer-term securities. In time, the Treasury’s reduction in issuance of coupon-bearing debt—notes and bonds with interest payments—will outweigh the Fed’s zeroing out of its quantitative-easing purchases of Treasuries. It’s a dynamic that hasn’t captured sufficient attention from investors, according to Wells Fargo & Co., and could help limit increases in borrowing costs as the central bank withdraws stimulus. Sales of regular coupon-bearing debt will be pared back by some $1 trillion by about the third quarter of 2022, according to a number of Wall Street banks. By comparison, Fed Chair Jerome Powell has said the central bank’s $80 billion-a-month in Treasuries purchases will be completely terminated by mid-2022. (Bloomberg)
Australia eased its international border restrictions on Monday for the first time during the coronavirus pandemic, allowing some of its vaccinated public to travel freely and many families to reunite, sparking emotional embraces at Sydney's airport. After 18 months of some of the world's strictest coronavirus border policies, millions of Australians are now free to travel without a permit or the need to quarantine on arrival in the country. While travel is initially limited to Australian citizens, permanent residents and their immediate families, it sets in motion a plan to reopen the country to international tourists and workers, both much needed to reinvigorate a fatigued nation. (Reuters)
Cryptocurrency prices today were trading mixed with the world's largest cryptocurrency by market capitalization trading marginally lower. Bitcoin prices today were down 0.9% at $61,693. It is up 112% this year so far after hitting a record high of near $67,000 in October. (Read here)
Punjab National Bank (PNB) is the only stock/securities in ban for trade on Monday, November 1, 2021 under the futures and options (F&O) segment by the National Stock Exchange (NSE). This securities have been put on ban under the F&O segment as they have crossed 95% of the market-wide position limit (MWPL), as per the NSE. (Read here)
Aurum, Vedanta, and Maruti Suzuki are among stocks in the news (Read here)
Gold prices edged lower on Monday, extending the previous session's losses, as the dollar strengthened after data showing another advance in inflation-fuelled bets over the Federal Reserve tightening its policy sooner.
* Spot gold fell 0.1% to $1,781.78 per ounce by 0044 GMT, after slipping to an over one-week trough on Friday. U.S. gold futures dropped 0.1% to $1,782.80.
* The U.S. dollar steadied close to its highest level since Oct. 13 hit on Friday, making gold less appealing to buyers holding other currencies.
* Data released on Friday showed the jury was still out on the Fed's claim that current price spikes are transitory and should moderate with time, with the personal consumption expenditures price index advancing last month to continue a run of inflation at levels not seen in 30 years.
* The Federal Reserve's two-day policy meeting concludes on Wednesday.
* Physical gold was sold at a premium in India last week as consumers flocked to retailers ahead of big festivals, while premiums in top consumer China dropped.
* Spot silver fell 0.2% to $23.81 per ounce. Platinum rose 0.5% to $1,023.03, while palladium eased 0.3%to $1,996.90.
Asian stocks climbed on Monday as traders digested the outcome of Japan’s election and fresh all-time highs for US shares. The yen weakened and a dollar gauge was steady. Equities jumped more than 1% in Japan, where Prime Minister Fumio Kishida’s Liberal Democratic Party preserved its outright majority, avoiding worst-case scenarios and smoothing the way for fiscal stimulus. Australia and South Korea pushed higher. US futures were in the green following records for the S&P 500 and Nasdaq 100 on optimism about corporate earnings. Data from China injected a note of caution. Purchasing managers’ indices signalled further economic weakness due to power shortages, surging commodity prices and strict covid controls. Traders are awaiting central bank meetings in the US, the UK and Australia this week. The Federal Reserve is expected to decide to scale back its bond-purchase programme. Short-term bond yields from Canada to Australia have jumped on bets that monetary authorities will also have to hike interest rates to curb inflation. Longer maturity US Treasury yields increased. Fixed-income market upheavals suggest investors anticipate a slowdown in the recovery from the pandemic as price pressures lead central banks to pare back economic support. Global shares have so far shrugged off such risks and remain close to all-time peaks.
China’s economy showed signs of further weakness in October as power shortages and surging commodity prices weighed on manufacturing, while strict covid controls put a brake on holiday spending. The official manufacturing purchasing managers’ index fell to 49.2, the National Bureau of Statistics said Sunday, the second month it was below the key 50-mark that signals a contraction in production. The non-manufacturing gauge, which measures activity in the construction and services sectors, dropped to 52.4, well below the consensus forecast. The PMIs show the economy is under pressure from both the supply and demand side. Manufacturers are struggling with electricity shortages and rising costs, while consumer spending remains weak as the government’s covid-zero approach means a tightening of restrictions around travel and social gatherings to contain frequent flare-ups of virus cases. (Bloomberg)
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