Sugar companies surge, Patel Engineering secures major contract

Technical Overview – Nifty 50

The Benchmark Index on 6th Sept witnessed a flat opening and traded in a very stagnant manner between the range of 50 – 80 points for the majority of the time.  The index witnessed a massive breakout in the last 30 minutes of trade reversed more than 100 points from the day’s low and closed above 19,600 levels and formed a green candle with a long wick indicating a reversal from the lower levels.

The Nifty on the daily chart has formed a bullish golden cross where 9 EMA has crossed above 21 EMA suggesting bullish momentum is likely ahead. The RSI (14) on the daily chart has witnessed a falling wedge pattern breakout above 50 levels with a bullish crossover.

The Index on the daily chart has closed above its psychological mark of 19,600 levels and a sustained move above the same will induce a breakout towards 19,700 – 19,750 levels for the coming days. On the flip side, 19,500 will act as immediate support for the index.

Technical Overview – Bank Nifty

The Bank Nifty underperformance continues for to third straight where the Benchmark index closed in gains and the Banking index witnessed a sideways trading range. The daily candle of the Bank Nifty suggests a short-covering rally towards the end and formed a wick on the lower end.

The index on the daily chart is trading within the rectangle pattern and moved above 50 & 21 EMA. The momentum oscillator RSI (14) has formed an intermediate bottom at 40 levels and presently moved above 50 levels with a bullish crossover.

On the broader time frame, the banking index is trading in a higher high bottom formation and taking support near its 21-week exponential moving average which is placed at 43,916 levels. Now the immediate hurdle for the bulls will be near 45,000 levels and a breakout above the said levels will initiate a bullish breakout in the Banking index. Similarly, on the lower side, 44,200 & 44,000 will act as immediate support for the Banking index.

Indian markets:

• Local shares had a mixed trading day, with indices ultimately gaining for the fourth consecutive session.
• Investor caution prevailed due to rising global uncertainty, US bond yields, and the dollar index.
• Foreign institutional investors offloaded local shares in response to this caution.
• The Nifty technically found support near the 19500 level and showed a midday turnaround, suggesting potential positive developments ahead.
• Sector performance varied. FMCG and pharma sectors rebounded strongly. Realty and metal sectors closed on a downbeat note

Global Markets

• Markets in Europe declined across the board while Asian stocks ended mixed on Wednesday after Saudi Arabia and Russia extended voluntary oil production cuts to the end of the year.
• Australias gross domestic product expanded 2.1% in the second quarter from a year ago, lower than the 2.3% year-on-year growth recorded in the first quarter.
• US stocks ended lower on Tuesday as the rise in crude oil prices weighed on stocks.

Stocks in Spotlight

• Patel Engineering’s stock closed 3 percent lower, despite the company winning a significant contract. Patel Engineering, in partnership with its joint venture (JV) partner, secured a letter of award for a substantial urban infrastructure development project worth Rs 1,275.30 crore from Madhya Pradesh Jal Nigam. The company’s share in this project, as a 35-percent partner in the JV, amounts to Rs 446.36 crore, with a project completion timeframe of 24 months. Despite this positive development, the stock saw a 3 percent decline in its closing price.
• Sugar stocks experienced a significant surge, with leading companies witnessing gains of up to 10%. This upswing came in response to Avlean, the world’s largest sugar trader, forecasting a sixth consecutive year of sugar shortages. Avlean attributed this expected deficit to a poor crop in India, a major sugar-producing nation. Investors are closely monitoring sugar stocks as the supply shortage is anticipated to drive price increases, potentially boosting the companies’ revenues.
• ABB India saw a 1.5 percent increase in its stock price following Jefferies’ decision to maintain a ‘buy’ rating on the company’s shares. Jefferies also set a target price of Rs 5,260, indicating a potential upside of 16 percent. This positive outlook is based on expectations of a strong ordering outlook, which should enable ABB India to maintain double-digit execution levels and achieve over 40 percent compounded annual growth in Earnings Per Share from 2022 to 2025.

News from the IPO world🌐

• Jyoti CNC Automation files papers for Rs. 1000 crore IPO
• 3 main board IPOs to hit this week plan to raise Rs. 1300 crore
• Samhi Hotels IPO to open on 14th September

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