IDFC Bank surges, Bajaj Finance Shares Surge on Strong Q1 Performance,  L&T Finance Holdings Faces Downgrade

The Markets Today in a nutshell

Technical Overview – Nifty 50

The Nifty50 on 04th July witnessed another gap-up opening and continued to trade higher with throughout the day with minor volatility. The benchmark index has witnessed four consecutive gap-up openings which indicate a structural bullish trend.

On a weekly time, frame, the Nifty surpassed the new milestone of 19,300 mark making it historically significant for the market. The Benchmark index has witnessed a bullish ascending triangle pattern breakout and the index is trading above the upper band of the bullish pattern on the weekly time frame.

INDIA VIX increased by 1.40% and closed at 11.70 levels. Max OI on Call at 19,400, Max OI on Put at 19,300, and Nifty PCR ratio stands at 1.47 for the 6th July expiry. Now index has to continue to hold above 19,200 zones to extend the move towards 19,450 – 19,500 zones while on the downside support exists at the 19,100 mark.

Technical Overview – Bank Nifty

Bank Nifty on the 04th of July witnessed a gap-up opening and formed a long-legged doji candle stick pattern on the daily time frame. The index continues to trade above the breakout levels and firmly holds above its 9 & 21 EMA. On the weekly chart, the index is trading above its 6-week high which indicates a consolidation breakout in the Banking Index. 

Max OI on Call at 46,500, Max OI on Put at 45,000, and Bank Nifty PCR ratio stands at 1.46 for the 6th July expiry.

Now index has to continue to hold above 45,000 zones to extend the move towards 45,800 – 46,000 zones while on the downside support exists at the 44,600 mark. 

Indian markets

• Domestic equities began July with strong performance, with benchmark indices reaching new record highs.
• The Sensex surpassed the 65,000 level for the first time.
• The Nifty concluded above the 19,300 mark.
• This surge was mainly driven by strong performances in metal, oil & gas, and financial stocks.
• Investor sentiment was positively influenced by promising domestic data and supportive global cues

Global Markets

• Most shares in Europe and Asia declined on Tuesday, with Wall Street set to remain closed on Tuesday in observance of Independence Day.

• Elsewhere, China unveiled export controls on two key minerals — gallium and germanium — in the latest development of an ongoing war over microchips between Beijing and the West. The metals are crucial in the production of microchips, military equipment, and communications.

• US stocks ended higher on Monday in a holiday-shortened session led by a rally in Tesla and strength in bank shares.

Stocks in Spotlight

• IDFC First Bank witnessed a decline in share price by over 4 percent following the announcement of the share swap ratio for its merger with IDFC Ltd. As per the merger agreement, IDFC Ltd shareholders will receive 155 equity shares of IDFC First Bank for every 100 equity shares held. Currently, IDFC Limited holds a 39.93 percent stake in IDFC First Bank through its non-financial holding company. Upon completion of the merger, the bank’s book value per share is expected to rise by 4.9 percent, based on audited financials as of March 31, 2023.

• L&T Finance Holdings experienced a 5 percent decline in its share price following a downgrade by Kotak Institutional Equities from ‘reduce’ to ‘sell’. The brokerage firm has expressed concerns about asset quality challenges in specific segments, despite assuming that the stressed book is adequately provided for. According to Kotak Institutional Equities, the company’s profitability is hindered by factors such as capital issuance during the Covid period and a prolonged period of no loan growth.

• Bajaj Finance shares saw surged, driven by the company’s impressive performance in the quarter ending June 2023. The customer franchise showed remarkable growth, reaching 72.98 million by June 30, 2023, compared to 60.30 million in the same period last year. Additionally, Bajaj Finance achieved its highest-ever quarterly increase in customer franchise, adding 3.84 million customers in Q1FY24. The company also experienced a notable rise in new loans booked during the same period, with a growth of 34 percent to 9.94 million, surpassing the 7.42 million recorded in Q1FY23. 

News from the IPO world🌐

• EbixCash IPO expected to hit market in July 2023
• SPC Life Sciences gets SEBI’s go ahead to float IPO
• Afcons begins IPO talks with banks.

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Sectoral Performance

Advance Decline Ratio

Numbers📈 that matter