Closing Bell: Nifty ends near 16,500, Sensex gains 226 pts led by IT stocks; auto, metal stocks drag
August 23, 2021 / 03:34 PM IST
Market Close: Benchmark indices ended on positive note in the volatile session on August 23 led by the IT stocks.
At close, the Sensex was up 226.47 points or 0.41% at 55555.79, and the Nifty was up 46 points or 0.28% at 16496.50. About 745 shares have advanced, 2438 shares declined, and 135 shares are unchanged.
HCL Technologies, Nestle, TCS, Bajaj Finserv and Bharti Airtel were the top Nifty gainers. Grasim Industries, Adani Ports, M&M, Eicher Motors and Bajaj Auto were among the top losers.
Among sectors, the Nifty IT index gained 1.7 percent each, while metal, auto and PSU bank indices lost 0.5-1.5 percent. BSE midcap index fell 0.90 percent and smallcap shed 1.5 percent.
Top 10 things to know before the market opens
The Indian stock market is expected to open in the red as trends on SGX Nifty indicate a gap-down opening for the index in India.
The BSE Sensex settled at 55,629.49, down 162.78 while the Nifty50 slipped 45.80 points to 16,568.80, forming a bearish candle on the daily charts as the closing was lower than opening levels.
According to pivot charts, the key support levels for the Nifty are placed at 16,502.47, followed by 16,436.13. If the index moves up, the key resistance levels to watch out for are 16,668.47 and 16,768.13.
Stay tuned to Moneycontrol to find out what happens in the currency and equity markets today. We have collated a list of important headlines across news platforms which could impact Indian as well as international markets:
The S&P 500 ended modestly higher in a choppy session on Thursday with gains in tech shares countering losses in cyclical sectors, as investors took the pulse of the economic rebound and gauged when the Federal Reserve might temper its monetary stimulus.
The Dow Jones Industrial Average fell 66.57 points, or 0.19%, to 34,894.12, the S&P 500 gained 5.53 points, or 0.13%, to 4,405.8 and the Nasdaq Composite added 15.87 points, or 0.11%, to 14,541.79.
Shares in Asia-Pacific mostly fell in Friday trade as China left its benchmark lending rate unchanged. Mainland Chinese stocks fell as the Shanghai composite declined about 1% and the Shenzhen component slipped 1.013%. Hong Kong’s Hang Seng index shed dropped 1.18%.
The Nikkei 225 in Japan fell 0.74% in morning trade while the Topix index shed 0.5%.
Trends on SGX Nifty indicate a gap-down opening for the index in India. The Nifty futures were trading at 16,373 on August 20 against August 18 close of 16,572 .
Oil slumps over 3%, hits May lows as losses extend to a sixth day
Oil prices skidded on Thursday for a sixth session, hitting lows not seen since May, pressured by a stronger U.S. dollar and concerns about weaker demand as COVID-19 cases rise.
The oil market rallied throughout the first half of 2021, but the newest wave of coronavirus infections throughout the world has sapped global travel and threatens economic activity. That comes just as major oil producers are readying supply increases and as U.S. drilling activity edges up.
Brent crude was down $2.42, or 3.6%, to $65.82 a barrel by 11:32 a.m. EDT (1532 GMT), after touching $65.57, lowest since May 21.
US jobless claims hit a pandemic low as hiring strengthens
The number of people seeking unemployment benefits fell last week for a fourth straight time to a pandemic low, the latest sign that America’s job market is rebounding from the pandemic recession as employers boost hiring to meet a surge in consumer demand.
The Labor Department reported Thursday that jobless claims fell by 29,000 to 348,000. The four-week average of claims, which smooths out week-to-week volatility, also fell — by 19,000, to just below 378,000, also a pandemic low.
The weekly pace of applications for unemployment aid has fallen more or less steadily since topping 900,000 in early January. The dwindling number of first-time jobless claims has coincided with the widespread administering of vaccines, which has led businesses to reopen or expand their hours and drawn consumers back to shops, restaurants, airports and entertainment venues.
CarTrade IPO shares to debut today
Leading multi-channel auto platform CarTrade Tech is expected to make a decent debut on the bourses considering its business model, the first-mover advantage in the sector and future growth prospects. Equity shares will list on the BSE and NSE on August 20.
The initial public offering of CarTrade saw a strong subscription during August 9-11, getting subscribed 20.29 times driven by institutional and non-institutional investors. The reserved portion of qualified institutional buyers was subscribed 35.45 times and that of non-institutional investors witnessed 41 times subscription. The retail portion was booked 2.75 times.
Emcure Pharmaceuticals files DRHP for proposed Rs 4,500-Rs 5000 crore IPO
Emcure Pharmaceuticals, on August 19 filed its Draft Red Hearing Prospectus (DRHP) with market regulator Securities and Exchange Board of India (SEBI) for its proposed initial public offer (IPO).
Market sources told Moneycontrol that the IPO size would be in the range of of Rs 4500 crore - Rs 5000 crore.
The initial public offering comprises a fresh issue of equity shares aggregating up to Rs. 1,100 crore and an offer for sale of up to 18,168,356 equity shares that include promoters - Satish Mehta selling up to 2,030,000 equity shares and Sunil Mehta aggregating up to 2,50,000 equity shares. Other selling shareholders include private equity investor Bain Capital, as well as certain individual selling shareholders.
US dollar climbs to 9-month peak on Fed taper view, Delta virus
The US dollar advanced to a nine-month high on Thursday, as worries about widespread coronavirus infections and Federal Reserve meeting minutes showing policymakers considering reducing pandemic-era stimulus this year hit global stocks and commodity-linked currencies.
The dollar index , which measures its performance against six currencies, hit 93.434, its highest since early November last year. It was last up 0.2% at 93.273.
FII and DII data
Foreign institutional investors (FIIs) net sold shares worth Rs 595.32 crore, while domestic institutional investors (DIIs) net offloaded shares worth Rs 729.49 crore in the Indian equity market on August 18, as per provisional data available on the NSE.
Stocks under F&O ban on NSE
Seven stocks - Cadila Healthcare, Canara Bank, NALCO, Punjab National Bank, SAIL, Sun TV Network and Vedanta - are under the F&O ban for August 20. Securities in the ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.
With inputs from Reuters & other agencies
Sensex, Nifty rise over a percent each to new highs, 5 key factors behind the rally
Across-the-board buying following positive global cues boosted domestic equities to fresh highs in the intraday trade on August 30.
Flagship indices the Sensex and the Nifty rose over a percent each to hit record highs of 56,958.27 and 16,951.50, respectively, in intraday trade.
In sync with the benchmarks, the BSE midcap index, too, made a fresh peak of 23,671.98.
At close, the Sensex was 765 points, or 1.36 percent, up at 56,889.76, while the Nifty was 226 points, or 1.35 percent, up at 16,931.05.
The BSE Midcap and smallcap indices closed with gains of 1.72 percent and and 1.55 percent, respectively.
“Following a strong gap-up opening, equity benchmark indices maintained the trend throughout the day in line with the strength in global markets. Global markets strengthened as the anxiety over the Jackson Hole symposium subsided following the dovish tone of the Fed Chair. Jerome Powell stated to stick with the wait-and-see approach giving reassurance that the easy money policy will continue this year with a smaller rate of tapering,” said Vinod Nair, Head of Research at Geojit Financial Services.
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Here are 5 key reasons that could have pushed the market to record high levels:
1 US Fed’s dovish stance
US Fed chairman Jerome Powell’s dovish stance seems to have boosted market sentiment. Powell hinted that the US central bank is not willing to quickly move towards raising rates.
The post-pandemic rally in the market has been mostly liquidity -driven and participants believe the market has more steam left as the liquidity tapering exercise is not likely to begin as early as was anticipated.
“The much-awaited Fed commentary after the Jackson Hole Symposium has indicated that ‘it would be appropriate to start reducing asset purchases this year’. But the Fed chief has hastened to add that there is much ground to cover before rate hikes. So, even though this can be treated as the beginning of normalisation of the accommodative policy, the communication is smart enough not only to calm the markets but to enthuse it too,” said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
2 Positive global cues
The positive sentiment of major global markets spilled on to the Indian market. Most Asian markets traded in the green after the US Fed chair’s dovish stance on the course of monetary stimulus and rate hikes.
Among the Asian peers, Nikkei, Hang Seng and KOSPI were in the green.
3 Macro factor
The foreign direct investment (FDI) into the country rose more than two folds to $17.57 billion during April-June this fiscal on account of measures such as policy reforms and ease of doing business, an official statement said on August 28.
Total FDI inflow rose to $22.53 billion during the first three months of 2021-22 as against $11.84 billion in the same period last year, it said. Total FDI comprises equity inflows, reinvested earnings and other capital.
FDI equity inflow grew by 168 per cent in the first three months of 2021-22 ($17.57 billion) compared to the year-ago period ($6.56 billion), it said.
“Indian benchmark indices started the week on a positive note, hitting fresh record highs. Traders are taking encouragement as foreign direct investment (FDI) into the country rises,” said Gaurav Garg, Head, Research, CapitalVia Global Research.
Besides, investors await the release of key economic data such as Q1GDP growth rate and manufacturing and services PMI prints. Analysts and economists believe the Q1 GDP prints may show a strong rebound
year-on-year due to the low base of the last year.
4 Rupee’s rise
The rupee’s rise against the dollar also seems to have influenced sentiment. The Indian rupee appreciated 31 paise to 73.38 against the dollar in the opening trade on August 30.
At the interbank foreign exchange, the rupee opened at 73.46 against the dollar, then surged higher to 73.38, up 31 paise over its previous close.
5 Technical factors
Analysts point out that the Nifty is trading with a positive bias and one should avoid taking any contra trades at this juncture until any reversal is seen.
“The immediate supports for the Nifty are placed around 16,600 and 16,500, while the levels to watch on the upside will be 16,800 and then 17,000,” said Ruchit Jain, Senior Technical and Derivatives Analyst, Angel Broking.
As per CapitalVia Global Research, 16,500 is an important support level for Nifty in the short term. If the market sustains above it, we can expect it to remain positive and gain momentum, leading to an upside move till 16,900-17,000 level, it said.
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